Monday, December 4, 2017

Snap: Exclusive Engagement Isn't Enough

New report shows Snap has an exclusive user base.
Snap must prove the business model though plenty of revenue upside exists with monetizing existing user base.
Valuation is extremely stretched despite the opportunity to grow revenues due to unconstrained operating expenses.
A new report backs the thesis that Snap (SNAP) has compelling user engagement that remains sticky. Unfortunately, user engagement is only one part of an investable business model that my research has questioned since the IPO.
Read the full article on Seeking Alpha. 

Disclosure: Long TWTR. Please review the disclaimer page for more details. 


Friday, November 10, 2017

LendingClub: Some Perspective

LendingClub plunged following disappointing Q4 guidance.
Most of the impacts are short-term adjustments to the credit model or temporary market conditions.
The fintech guided to record revenues for Q4 and expects further growth in 2018.
LendingClub (LC) plunged 16% in the first day of trading following Q3 resultsafter taking a hit leading into earnings. Despite record revenues, the market was highly displeased with projections even considering a highly attractive valuation.
Read the full article on Seeking Alpha. 

Disclosure: Long LC. Please review the disclaimer page for more details. 


Disney: Predictable Decline

The FQ4 results for Disney (DIS) were predictably weak. The ongoing weakness in cable networks was hidden last year by the strength of movies and the media giant is now getting hit by weaknesses in both segments.

Incredibly though, the stock still trades near $100 and at levels that mostly exceed the price last year. Is now really the time to own Disney as the company embarks on a digital shift? Disney missed both top and bottom line analyst estimates in a sign of how bad the times are now. The media giant has missed revenue estimates for five consecutive quarters, but the company didn't previous miss EPS forecasts. Disney faces multiple issues that can't offset the positive momentum from their parks and resorts division.

Thursday, October 26, 2017

Sprint: Not Making A Good Case

Sprint reports improving FQ2 results.
The highlights and CEO message aren't supportive of regulatory approval of a merger with T-Mobile.
Net debt position remains a problem for stock gains absent a merger and industry consolidation.
Along with FQ2 resultsSprint (S) released data points that aren't supportive of an industry needing consolidation. My investment thesis continues to suggest the stock isn't worth much more than the current price based on the results and the reported deal on the table with T-Mobile (TMUS).
Read the full article at Seeking Alpha. 

Disclosure: No position. Please review the disclaimer page for more details. 


GrubHub: No Competition Fears Here

GrubHub surges following strong revenue guidance for Q4.
The market appears to misunderstand the inclusion of Eat24 numbers into the estimates.
Solid financial metrics support the effective handling of competition.
Stock valuation remains a question as EBITDA will trail sales growth in 2018.
In no real surprise, GrubHub (GRUB) easily fought off competition during Q3. As the company integrates recent acquisitions, the bigger issue is valuation now that the online food order and delivery service added debt to the balance sheet and boosted sales.
Read the full article on Seeking Alpha. 

Disclosure: No position. Please review the disclaimer page for more details.