In today’s briefing:
- MicroStrategy (MSTR US): Saylor Mirrors Bitcoin’s Fall
- Moderna (MRNA US): Better-Than-Expected Q2 Result; Guidance Reiterated; $3B Share Buyback Announced
- General Electric Company: New Product Lines
- The Coca-Cola Co: The Jack & Coke Launch
- Better Than Expected 2Q22 Results, Cloud Growth of 139% YoY, FY22 Revenue Guidance Moves Higher
- Mondelez International Inc.: The Clif Bar Acquisition & Other Drivers
- Breaking Growth Short Candidates: Shopify, Snowflake, Intuitive Surgical, ServiceNow
MicroStrategy (MSTR US): Saylor Mirrors Bitcoin’s Fall
- Microstrategy Inc (MSTR US)‘s Michael Saylor will now assume the new role of Executive Chairman and Phong Le, MSTR’s President, will serve as the company’s new CEO.
- As Executive Chairman, Saylor will focus more on MSTR’s bitcoin acquisition strategy and related bitcoin advocacy initiatives.
- With one of the most bullish and influential players in the industry now focusing on crypto, this should be considered bullish, according to some media reports. That’s a desperate takeaway.
Moderna (MRNA US): Better-Than-Expected Q2 Result; Guidance Reiterated; $3B Share Buyback Announced
- Moderna Inc (MRNA US) reported strong Q2 results, with both revenue and EPS surpassing consensus. Profitability was negatively impacted by one-off inventory write-down charge.
- Management has reiterated advance purchase agreements for expected delivery of ~$21 billion in 2022. Assuming an endemic situation, Moderna’s commercial infrastructure is prepared for a 2023 commercial market.
- The Board of Directors has approved a new share repurchase program for $3 billion in August 2022, with no expiry. Moderna shares have gained 27% in last three months.
General Electric Company: New Product Lines
- General Electric has started seeing a solid recovery in its aerospeace business which has become an important growth driver for the company.
- Macro pressures and supply chain have affected the revenue adversely by approximately 5%.
- The company has recently unveiled the innovative branding of its new companies, GE Vernova, GE Healthcare, and GE Aerospace.
The Coca-Cola Co: The Jack & Coke Launch
- Coca-Cola has been implementing various growth initiatives off-late to continue expanding its top-line.
- The company had a good quarter and delivered an all-around beat and increased its volume and value share during the quarter.
- Coca-Cola continued its strong marketing efforts and launched end-to-end digital-first brand campaigns for smartwater and vitaminwater.
Better Than Expected 2Q22 Results, Cloud Growth of 139% YoY, FY22 Revenue Guidance Moves Higher
- Confluent (CFLT US) reported solid 2Q22 results, and most metrics were above sell-side expectations, including subscription revenue, gross margins, and operating margins.
- We are impressed with Confluent Cloud’s revenue growth of +139% y/y and strong subscription gross margins. Management raised FY22 revenue and profitability guidance.
- Our price target of $28 is slightly below the current share price. However, we see room for further multiple expansion due to revenue acceleration above consensus.
Mondelez International Inc.: The Clif Bar Acquisition & Other Drivers
- Mondelez International has been looking to strengthen its position in the snacking category and the recent $2.9 billion acquisition of Clif Bar is a key step in the process.
- The company managed to deliver a strong result and an all-around beat with strong bottom and top-line performance growth in overall categories and regions.
- These results, along with ongoing revenue growth management, simplification, and cost discipline, are delivering strong cash flow and robust profit dollar growth.
Breaking Growth Short Candidates: Shopify, Snowflake, Intuitive Surgical, ServiceNow
- 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
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