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

Meta Platforms Inc. operates as a social technology company. The Company builds applications and technologies that help people connect, find communities, and grow businesses. meta Platform is also involved in advertisements, augmented and virtual reality.

<ul>
<li>The recently announced Meta Verified could generate an incremental $2.2B in revenues.</li>
<li>Incremental layoffs being reported could amount to $5B in incremental savings this year.</li>
<li>Between the two reports, we could easily see 10% upside to EPS.</li>
</ul>


The recently announced Meta Verified could generate an incremental $2.2B in revenues.
Incremental layoffs being reported could amount to $5B in incremental savings this year.
Between the two reports, we could easily see 10% upside to EPS.


Intel Corporation designs, manufactures, and sells computer components and related products.  The Company's major products include microprocessors, chipsets, embedded processors and microcontrollers, flash memory products, graphics products, network and communications products, systems management software, conferencing products, and digital imaging products.

<ul>
<li>Intel cut its dividend by 2/3rd, freeing up $4B in cash.</li>
<li>The company revised own capital intensity guidance for 2023 to low 30s% from 35%, while maintaining 24/25 guidance.</li>
<li>Recent $11B debt raise and Mobile eye shares should provide enough capital for the next year.</li>
</ul>


Intel cut its dividend by 2/3rd, freeing up $4B in cash.
The company revised own capital intensity guidance for 2023 to low 30s% from 35%, while maintaining 24/25 guidance.
Recent $11B debt raise and Mobile eye shares should provide enough capital for the next year.


Intel’s Cut Its Dividend, But Should It Cut Its Foundry?

Palo Alto Networks, Inc. provides network security solutions. The Company offers firewalls that identify and control applications, scan content to stop threats, prevent data leakage, integrated application, user, and content visibility. Palo Alto Networks serves customers worldwide.

<ul>
<li>Huge operating margin and FCF beat as PANW is maintaining efficiency with slower headcount growth and supply chain issues abating supporting gross margins. </li>
<li>Deal sizes continue to grow dramatically: $1M deals grew 20% YoY, and  transactions size grew nearly 60%. $5M+ deals grew 84% YoY and $10M+ deals grew 140%.</li>
<li>Prisma' Access' SASE product continues to be the catalyst driving 2.5x revenue lift vs. legacy firewalls.</li>
</ul>


Huge operating margin and FCF beat as PANW is maintaining efficiency with slower headcount growth and supply chain issues abating supporting gross margins. 
Deal sizes continue to grow dramatically: $1M deals grew 20% YoY, and  transactions size grew nearly 60%. $5M+ deals grew 84% YoY and $10M+ deals grew 140%.
Prisma' Access' SASE product continues to be the catalyst driving 2.5x revenue lift vs. legacy firewalls.


Palo Alto Networks: Even Better Than Crowdstrike?

Pinterest, Inc. operates and maintains social networking site. The Company provides online venue for personal photos, ideas, oddities, decorations, places to visit, recipes, and other items. Pinterest serves customers worldwide.

<ul>
<li>MAUs grew just 5M or 1% QoQ while ARPU was flat. Little turnaround traction evident despite lots of empty statistics offered.</li>
<li>Longtime CFO Todd Morgenfeld departing, offers vague margin expansion promises.</li>
<li>Revenue and opex guidance for 1Q23 below consensus...not good for a consensus long.</li>
</ul>


MAUs grew just 5M or 1% QoQ while ARPU was flat. Little turnaround traction evident despite lots of empty statistics offered.
Longtime CFO Todd Morgenfeld departing, offers vague margin expansion promises.
Revenue and opex guidance for 1Q23 below consensus...not good for a consensus long.


Amazon.com, Inc. is an online retailer that offers a wide range of products. The Company's products include books, music, videotapes, computers, electronics, home and garden, and numerous other products.  Amazon offers personalized shopping services, Web-based credit card payment, and direct shipping to customers.

<ul>
<li>AWS revenue grew 20% YoY to $21.3B, about $400M or ~2% below consensus…and a 700bp deceleration.</li>
<li>AWS margins of 24% were down 200bps QoQ / 600bps YoY as continued optimization of customer contracts continues to weigh on margins.</li>
<li>Amazon advertising continues to dramatically outpace all other online platforms, highlighting the moat of first party data at the point of purchase, unimpacted by Apple.</li>
</ul>


AWS revenue grew 20% YoY to $21.3B, about $400M or ~2% below consensus…and a 700bp deceleration.
AWS margins of 24% were down 200bps QoQ / 600bps YoY as continued optimization of customer contracts continues to weigh on margins.
Amazon advertising continues to dramatically outpace all other online platforms, highlighting the moat of first party data at the point of purchase, unimpacted by Apple.


I have over 20 years’ experience investing in the TMT and Consumer sectors, almost entirely on the buyside. Started at Bernstein covering software in 2001, moved to the buyside at Government of Singapore Investment Corporation (GIC) in 2003, covering hardware, software, and media. 

After getting an MBA at NYU in 2008 and a CFA, I spent 8 years at Coburn Ventures (a market neutral TMT/Consumer hedge fund). In 2015, I joined Deimos Asset Management, a low net multi-strat, where I managed a  TMT/Consumer portfolio.

I've spent the past few years at Obex Capital Management providing independent investment research to TMT and Consumer investors.