Fundamental Short Selling Research

Eric Fernandez, CFA

TwoRiversAnalytics

Equity Bottom-Up

<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

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.

Equity Capital Markets

<ul><li>Snowflake was often one of the top trending stocks during the NASDAQ bull run but its fortunes have reversed just like most other high-growth tech stocks after the interest rate hike.</li><li>The $5 million-plus threshold was crossed by 10 customers on a 12-month basis for Snowflake in the recent result and they added sixteen new global 200 customers.</li><li>We give the company a ‘Hold’ rating for its stock with a revision in target price.</li></ul>

Snowflake was often one of the top trending stocks during the NASDAQ bull run but its fortunes have reversed just like most other high-growth tech stocks after the interest rate hike.The $5 million-plus threshold was crossed by 10 customers on a 12-month basis for Snowflake in the recent result and they added sixteen new global 200 customers.We give the company a ‘Hold’ rating for its stock with a revision in target price.

Snowflake Inc.: The Streamlit Acquisition & Other Drivers

Equity Research, Equity Breakdown

Equity Breakdown

Equity Research

Our goal in Equity Breakdown is to take a public filing of a company and break it down into simple facts, no bullshit! We will provide you with the power of information and time to quickly understand a company.

<ul><li>One of the most anticipated IPO’s of the year is finally happening. This would represent the third-largest IPO of the year after Snowflake’s snowstorm and Bill Ackman’s Goliath-like SPAC.</li><li>Tonight we will breakdown <strong>Airbnb, (ABNB), </strong>a company that wants to revolutionize human connection through authenticity, community, and design.</li><li>Airbnb is a technology company that fosters a marketplace for home-sharing at a global scale.</li></ul>

One of the most anticipated IPO’s of the year is finally happening. This would represent the third-largest IPO of the year after Snowflake’s snowstorm and Bill Ackman’s Goliath-like SPAC.Tonight we will breakdown Airbnb, (ABNB), a company that wants to revolutionize human connection through authenticity, community, and design.Airbnb is a technology company that fosters a marketplace for home-sharing at a global scale.

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.

<ul>
<li>Ignore the slight macro weakness from consumer facing internet companies in April. It is irrelevant for the LT model. </li>
<li>Snowflake upped its LT (FY2029) targets: $10B in revenues, growing 30%, 78% product margins, 20% operating margins, and 25% adjusted FCF margins.</li>
<li>At 12x forward revenues, Snowflake's valuation is...dare we say... cheap?</li>
</ul>


Ignore the slight macro weakness from consumer facing internet companies in April. It is irrelevant for the LT model. 
Snowflake upped its LT (FY2029) targets: $10B in revenues, growing 30%, 78% product margins, 20% operating margins, and 25% adjusted FCF margins.
At 12x forward revenues, Snowflake's valuation is...dare we say... cheap?


Palantir Technologies  / Equity Bottom-Up

<ul>
<li>Revenue growth ex-SPAC decelerated to 19% this quarter, 11% below consensus.</li>
<li>1Q22 20% operating margins vs. consensus 27% margins as the company invests to reaccelerate growth in 2H from rising government contracts due to war.</li>
<li>Alex Karp warns that nuclear war in Ukraine is being dramatically underestimated.</li>
</ul>


Revenue growth ex-SPAC decelerated to 19% this quarter, 11% below consensus.
1Q22 20% operating margins vs. consensus 27% margins as the company invests to reaccelerate growth in 2H from rising government contracts due to war.
Alex Karp warns that nuclear war in Ukraine is being dramatically underestimated.


Palantir 1Q22 Earnings: War Supposedly Good for Business?

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)

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

Snowflake Inc.: The Streamlit Acquisition & Other Drivers

Snowflake was often one of the top trending stocks during the NASDAQ bull run but its fortunes have reversed just like most other high-growth tech...

Baptista Research

Airbnb (ABNB) Breakdown

One of the most anticipated IPO’s of the year is finally happening. This would represent the third-largest IPO of the year after Snowflake’s...

Equity Breakdown

Snowflake 1Q22 Earnings: 2029 Looks Good

Snowflake trades at 12x forward revenues and the company just doubled its LT operating model's profitability targets: 20% operating margins, and...

Aaron Gabin

Palantir 1Q22 Earnings: War Supposedly Good for Business?

Decelerating growth continues and margins continue to decline. But war is good for Palantir (supposedly), and growth should reaccelerate in 2H22...

Aaron Gabin

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