Why Coupang CPNG Stock Is Up Today

what is coupang stock

And what’s even more confounding is that Coupang’s market cap is made up of nearly 20% net cash, and it’s already amply profitable. And yet, investors have wanted nothing to do with the South Korean e-commerce company. A group of investors are pushing back against the proposed sale of Farfetch FTCH , the luxury fashion marketplace and technology platform, to the South Korea-based e-commerce marketplace company Coupa… In the days ahead, monitoring the region’s GDP expectations would be a good angle. As Coupang sells both discretionary and non-discretionary items, inflation may actually assist revenue growth in their consumer staples sales. With the company generating an expected $24.42 Billion to finish out the 2023 fiscal year, 1.5 X would be a $36.63 Billion market cap.

  1. It also performs operations and support services in the United States, South Korea, Taiwan, Singapore, China, Japan, and India.
  2. During the quarter, Coupang acquired Farfetch, the leading e-commerce platform for luxury goods, by extending it a $500 million bridge loan that wiped out its equity holders.
  3. Struggling luxury retailer Farfetch has been purchased by Coupang, the South Korean eCommerce giant.
  4. The wider one shows that Coupang’s core, Product Commerce, segment saw its underlying profitability increase by nearly 2% points y/y from approximately 5.1% to 7.1%.

The company is now slightly GAAP profitable but also has a healthy free cash flow yield. From only 5% pre-IPO to 25% at current, the company is becoming ever more profitable with ever-increasing https://www.investorynews.com/ automation. “In the original edition of ‘What works on Wall Street’, O’Shaughnessy wrote that the single-best value factor was a company’s price-to-sales ratio (P/S).

Even if a secondary stock sale were to result in the release of 50 million new shares, the total dilution would amount to less than 3% — hardly worthy of a 20% decline in the share price. © 2024 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided ‘as-is’ and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see Barchart’s disclaimer. According to analysts, Coupang’s stock has a predicted upside of 20.41% based on their 12-month stock forecasts.

CPNG Price Targets by Month

New York-listed e-commerce giant Coupang plans to buy Farfetch Holdings in a deal that will provide the struggling online luxury fashion retailer with $500 million in capital to stay in operation, the… This was the same thesis I used in my article on Block Inc. (SQ) and Uber. Coupang saw a decrease in short interest during the month of February. As of February 15th, there was short interest totaling 20,140,000 shares, a decrease of 5.6% from the January 31st total of 21,330,000 shares.

Coupang’s Q4 was up against the easiest comparable quarter of the prior year. Therefore, it was clearly going to deliver a strong performance, with solid revenue growth rates. Slowing growth in 2022 had sent the stock down almost 80% from its previous peak, so investor expectations have been low. Investors have also had to process the rationale for Coupang’s recent acquisition of online luxury goods marketplace Farfetch, which has struggled to generate profitable growth. The largest item that stands out on the cash flow statement is the larger than normal increase in accounts payable and a positive starting net income of $429 million.

Farfetch $500m Lifeline As Coupang Swoops To Buy Online Retailer

Analysts like Coupang more than other Retail/Wholesale companies. The consensus rating for Coupang is Moderate Buy while the average consensus rating for retail/wholesale companies is Hold. Michael Wiggins De Oliveira is an inflection investor. This means buying into cheap companies at the moment when their narrative is changing and the business is on a path toward becoming significantly more profitable over the next year.

what is coupang stock

In conclusion, as I assess Coupang’s recent Q results, I’m drawn towards its low valuation of 14x forward EBITDA for its core business. Immediately, what you’ll notice is the 50 basis point expansion in underlying profitability. But what if I told you that Coupang’s core profitability is actually clipping much higher than this, but this profitability is being masked by its “Other Projects”, named Developing Offerings? Anyone who follows my work will know that I put a lot of focus on the customer adoption curve. And for Coupang to still be increasing its active customers to 21 million, goes to the heart of the bear case that long ago argued that Coupang had already saturated its market penetration in South Korea. Coupang is up 15.1% since the beginning of the year, and at $18.10 per share it is trading close to its 52-week high of $19.31 from August 2023.

The e-commerce giant’s stock went into a tailspin based on a rumor. But a closer look show it’s much ado about nothing.

Based on an average daily volume of 9,600,000 shares, the short-interest ratio is currently 2.1 days. Approximately 1.7% of the shares of the stock are sold short. With a focus on tech and “the Great Energy Transition (including uranium)”, Michael runs a concentrated portfolio https://www.topforexnews.org/ with approximately 15 to 20 stocks and an average holding period of 18 months. So, even though the business is optically extremely profitable, it won’t ever trade at a US-like multiple. There’s no need to try to attempt to justify it otherwise, this is a simple fact.

Farfetch, with its $4 billion GMV, brings a new dimension to Coupang’s portfolio, offering the potential to capture a significant share of the untapped luxury e-commerce market. The integration of Farfetch aligns with Coupang’s commitment to providing diverse, high-quality offerings and could open avenues for substantial value creation. Coupang is a South Korean e-commerce player known for its innovative approach to customer experience and delivery services. Primarily operating in Korea and Taiwan, Coupang has expanded its offerings beyond product commerce to include services like Rocket delivery. Coupang, a South Korea-headquartered e-commerce company, said it will accelerate its investment in Taiwan after four straight quarters of profits. Coupang was the most downloaded app in the second qua…

As investors have continued to embrace a risk-off sentiment, anything that is not the magnificent 7 mega caps appears not to be rewarded with any positive traction. SEATTLE & LONDON–(BUSINESS WIRE)–Coupang, Inc. announced today that it has completed the acquisition of the assets of global online luxury company Farfetch Holdings plc. The company wants to sell everything from the ground up in South Korea and have it delivered in less than 24 hours. Time is precious, and a commute to the store in heavy traffic can wipe out hours of an individual’s day. Another great-looking balance sheet that is relatively light on debt. The company has both current assets, cash and short-term equivalents well ahead of long-term debt.

Why Coupang (CPNG) Stock Is Up Today

O’Shaughnessy used to run O’Shaughnessy Asset Management, LLC, an asset management firm that Franklin Templeton later acquired. Through his writing and research, he reviewed which fundamental premise was most indicative of value and support levels for a stock. He found that price-to-sales was even more effective in predicting value than price-to-earnings or other ratios.”

Coupang has reported strong financial results for the third quarter of 2023. The company’s net revenues reached $6.2 billion, with a year-over-year growth of 21% on a reported basis and 18% on an FX-n… As a long-term “buy and hold” investor, I am less prone to the whims of earnings reports on a quarter-to-quarter basis. Nonetheless, we have 5 downward revisions and only one upward by analysts rolling into this report. Let’s also keep in mind that this quarter will encompass Christmas, and South Korea, being a largely Christian country, does celebrate the holiday with a day off and extra gift buying.

Farfetch just announced it has sold all of its business and assets through a pre-pack administration process effective January 30, 2024. The deal was done through a Coupang Inc. owned entity named Sur… SEATTLE & WASHINGTON–(BUSINESS WIRE)–Coupang continues its strategic partnership with the U.S. Dept. of Commerce and International Trade Administration by co-hosting webinars for sellers.

Coupang’s top-line momentum shows it is on course to join the ranks of other top e-commerce companies that have delivered superior returns to shareholders. According to the issued ratings of 4 analysts in the last year, the consensus rating https://www.dowjonesanalysis.com/ for Coupang stock is Moderate Buy based on the current 2 hold ratings and 2 buy ratings for CPNG. The average twelve-month price prediction for Coupang is $21.07 with a high price target of $25.00 and a low price target of $17.00.

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