TMT & Consumer Independent Equity Research Analyst, Obex Capital Research

Aaron Gabin

TMT & Consumer Independent Equity Research Analyst

TMT & Consumer Independent Equity Research

Obex Capital Research

“Obex” is Latin for Barriers to Entry. Obex Capital Management’s investment philosophy is driven by an intense focus on which business model’s Barriers to Entry are able to withstand the ever increasing competitive disruption in the TMT and Consumer Sectors.

Equity Bottom-Up

<ul>
<li>Crowdstrike continues to gobble up share, printing another strong beat and raise, with ARR now at $2B, the second fastest software company to hit that mark.</li>
<li>EBIT margins up 800bps YoY, TTM FCF Margins 30%...profitable growth at Scale.</li>
<li>13x forward P/S for a unique software asset with long runways for 40%+ growth and multi-module driven margin expansion with a 15% pullback in the past week despite earnings.</li>
</ul>


Crowdstrike continues to gobble up share, printing another strong beat and raise, with ARR now at $2B, the second fastest software company to hit that mark.
EBIT margins up 800bps YoY, TTM FCF Margins 30%...profitable growth at Scale.
13x forward P/S for a unique software asset with long runways for 40%+ growth and multi-module driven margin expansion with a 15% pullback in the past week despite earnings.


Crowdstrike FY2Q23: FY2Q23: Not Just Endpoint, Identity and SIEM Accelerating Too

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul>
<li>Widespread workload enablement has been a key driver responsible for Snowflake to deliver an excellent result.</li>
<li>Snowflake managed to deliver an all-around beat with financial services seeing the largest product revenue growth sequentially while all its other verticals also expanded well.</li>
<li>The company is also on track to acquire Applica to enable customers to leverage unstructured data more easily in the Snowflake Data Cloud.</li>
</ul>


Widespread workload enablement has been a key driver responsible for Snowflake to deliver an excellent result.
Snowflake managed to deliver an all-around beat with financial services seeing the largest product revenue growth sequentially while all its other verticals also expanded well.
The company is also on track to acquire Applica to enable customers to leverage unstructured data more easily in the Snowflake Data Cloud.


Snowflake Inc: Support For Unstructured Data & The Applica Acquisition

Stock Picking & Investing, BluSuit

BluSuit

Stock Picking & Investing

Financial markets, high growth & innovative business coverage, macro economics, trading strategy and market insight

<ul><li>In my opinion, DLocal is an expensive stock. Typically when you see very expensive businesses not outperform on every metric, or at least a majority of them, you see their stock price struggle.</li><li>On a valuation perspective, DLocal finds itself priced in line with the most expensive stocks on the stock market.</li><li>The thing that makes DLocal unique is its profitability compared to many of the other software stocks as they run 35%+ EBITDA margins on a consistent basis.</li></ul>

In my opinion, DLocal is an expensive stock. Typically when you see very expensive businesses not outperform on every metric, or at least a majority of them, you see their stock price struggle.On a valuation perspective, DLocal finds itself priced in line with the most expensive stocks on the stock market.The thing that makes DLocal unique is its profitability compared to many of the other software stocks as they run 35%+ EBITDA margins on a consistent basis.

<ul>
<li>Product revenues beat consensus by 7% and EBIT margins by 5%, while full year guidance was and margins were raised ~2% ahead of consensus.</li>
<li>Fears of a consumption model driven slowdown (like Datadog) did not play out, and cRPO growth actually accelerated QoQ to 81%.</li>
<li>Data sharing is picking up with larger customers, with 65% of $1M+ customers utilizing stable edges.</li>
</ul>


Product revenues beat consensus by 7% and EBIT margins by 5%, while full year guidance was and margins were raised ~2% ahead of consensus.
Fears of a consumption model driven slowdown (like Datadog) did not play out, and cRPO growth actually accelerated QoQ to 81%.
Data sharing is picking up with larger customers, with 65% of $1M+ customers utilizing stable edges.


Snowflake FY2Q23 Earnings: High in the Hierarchy of Needs

Fundamental Short Selling Research

Eric Fernandez, CFA

TwoRiversAnalytics

<ul>
<li>This model looks for slowing growth, margin declines, sales and/or earnings disappointments, troubling working capital trends, poor estimate trends or lowered guidance, among other characteristics.</li>
<li>The key judgement is whether a slowdown is temporary or the beginning of a trend.  These shorts tend to have high valuations and betas.  Multiple compression accelerates the stock’s decline.</li>
<li>Today we are flagging: Shopify, Snowflake, Intuitive Surgical, and ServiceNow</li>
</ul>


This model looks for slowing growth, margin declines, sales and/or earnings disappointments, troubling working capital trends, poor estimate trends or lowered guidance, among other characteristics.
The key judgement is whether a slowdown is temporary or the beginning of a trend.  These shorts tend to have high valuations and betas.  Multiple compression accelerates the stock’s decline.
Today we are flagging: Shopify, Snowflake, Intuitive Surgical, and ServiceNow


Breaking Growth Short Candidates: Shopify, Snowflake, Intuitive Surgical, ServiceNow

United States

Snowflake Inc. provides software solutions. The Company develops database architecture, data warehouses, query optimization, and parallelization solutions. Snowflake serves customers worldwide.

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Snowflake (SNOW US)

Crowdstrike FY2Q23: FY2Q23: Not Just Endpoint, Identity and SIEM Accelerating Too

Crowdstrike’s stock has pulled back in the past week or so by 15%, despite another superb quarter. 13x forward forward P/S sounds reasonable given...

Aaron Gabin

Snowflake Inc: Support For Unstructured Data & The Applica Acquisition

Widespread workload enablement has been a key driver responsible for Snowflake to deliver an excellent result. Snowflake managed to deliver an...

Baptista Research

Earnings in Review: DLocal and Snowflake

The thing that makes DLocal unique is its profitability compared to many of the other software stocks as they run 35%+ EBITDA margins on a...

BluSuit

Snowflake FY2Q23 Earnings: High in the Hierarchy of Needs

Given how tough macro has roiled software (CRM) recently, Snowflake’s monster 2Q23 beat was impressive and defused questions about vital...

Aaron Gabin

Breaking Growth Short Candidates: Shopify, Snowflake, Intuitive Surgical, ServiceNow

Breaking Growth stocks combine declining fundamentals with a multiple compression. This week we flag: Shopify, Snowflake, Intuitive Surgical, and...

Eric Fernandez, CFA

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