Amazon, the world’s largest online retailer, increased its net profit by more than 48% in Q2, but the online shopping boom fueled by the pandemic appears to be fading away. Revenue increased by 27% and reached $ 113.080 billion against $ 88.912 billion a year earlier. Net income in April-June was $ 7.778 billion, or $ 15.12 per share, compared to $ 5.243 billion, or $ 10.3 per share, received in the same period last year. Although the company’s revenue surpassed the $ 100 billion mark for the third quarter in a row, the market regarded last quarter’s growth as weak, as it jumped 44% in January-March. Experts, on average, expected the company to receive earnings of $ 12.28 per share in the second quarter on revenue of $ 115.4 billion. The financial statements disappointed investors, so the company’s stock prices fell 7% after the publication of the financial statements.
Tag: CASH MANAGEMENT
Wine is gaining popularity
We begin coverage of Vintage Wine Estates. We believe that, driven by strong M&A activities, double-digit revenue growth and market share growth will continue in the medium term, allowing the company to invest the generated cash flows in business development. VWE expects to increase its Adjusted EBITDA margin by more than 1,000 basis points to 25.9% between 2020-2023. The increase in gross profitability from capital expenditures will be supported by mergers and acquisitions that increase margins, as the last deal had an adjusted EBITDA margin of 60%.
Apple surprised with record quarterly revenue
Apple increased its net profit by 93%, the revenue was a record for 3 financial quarters. Apple increased its fiscal third quarter net income by 93% and revenue by 36%, both of which beat market forecasts. Apple’s revenue was $ 81.43 billion and was a record for the third financial quarter. The consensus forecast of experts for this indicator was $ 73.34 billion. The company showed record revenue figures in all geographic segments and double-digit revenue growth rates in each product category. Net income for the quarter ended June 26 was $ 21.74 billion, up from $ 11.25 billion in the third quarter of the previous fiscal year. Earnings per share increased to $ 1.3 from $ 0.65, beating the market consensus of $ 1.01.
Flowserve is in the early stage of a new growth cycle
We believe that growth in corporate capital expenditure in the core industries in which Flowserve operates may accelerate significantly, which could place the company in the early stages of a new growth cycle. Notably, this trend correlates with management efforts to improve operational efficiency to increase cash flow generation. In the first quarter, Flowserve orders rose 15% qoq and management is fairly optimistic that this trend will continue.
FDA Approves Intelligent Knee Implant
Zimmer Biomet Holdings announced that the FDA has approved Persona IQ, which will enable ZBH to launch the world’s first intelligent implant that can completely replace the knee joint. Persona IQ will be a significant addition to ZBEdge ZBH’s growing portfolio, contributing to the expected acceleration in Kneefranchise’s revenue growth
Facebook doubled profit for the quarter
Facebook in the second quarter doubled its net profit and revenue by 56%. Net income in April-June was $ 10.394 billion, or $ 3.61 per share, compared to $ 5.178 billion, or $ 1.8 per share, received in the same period last year. Revenue increased to $ 29.077 billion from $ 18.687 billion a year earlier, while advertising revenues increased by 56% – to $ 28.58 billion. The market consensus assumed earnings growth to $ 3.04 per share on revenue of $ 27.85 billion.
Where is my Uber?
Our research indicates positive dynamics of the e-commerce market in 2Q21. For Uber Eats, this translates into an increase in MAU and purchase frequency on a quarterly and yearly basis, a potential indicator of sustained growth in delivery orders. Our assessment of Uber Technologies is based on a differentiated approach, thanks to the company’s global reach and market leadership in various transportation and logistics segments, coordinated by applications. We maintain positive sentiment on the companies business.
Cosmetics demand returned to pre-pandemic levels
Ulta Beauty posted excellent Q2 financials. Earnings per share were $ 4.56 versus the market consensus of $ 2.59. Returning shoppers and an improved product range have provided significant support to the company’s financial performance. Total sales of cosmetics for the past quarter approached 2019 levels. The company’s management improved its forecast for 2021, which assumes accelerated growth in revenue and margins in 2H21, but at a slower pace compared to 1H21 due to the risk of rising inflation, persisting supply chain problems and uncertainty over COVID-19. A loyalty program, multi-channel engagement, and an innovative brand lineup serve as good long-term drivers of business growth. We are raising our target price for ULTA shares from $ 385 to $ 490.
The market continued to slightly correct
Last week, major US indices continued to correct. So the S&P 500 fell 0.4%, while the NASDAQ 100 lost 1%. Nevertheless, at the end of July, the indices rose by 1.8% and 2.8%, respectively, and since the beginning of the year the indicators have added 16-17%. The reporting season remains the focus of traders’ attention. The profit of 89% of S&P index companies, which have already reported results, exceeded analysts’ expectations. The largest tech companies released their quarterly earnings last week. Thus, the results of Microsoft, Facebook and Google and Apple were significantly better than market expectations, while the reports of Amazon disappointed investors. The company’s revenue fell below market consensus.
We appreciate the Enphase strategy
Enphase is an American company that manufactures micro-inverters and power electrical modules for residential and commercial PV systems. The key to the company’s success is the development of an ASIC that addresses the issues of cost savings and increased integration. We believe that semiconductor shortages could put pressure on Enphase Energy’s business through the end of 2021. However, we see high upside potential for the company’s stock, suggesting that supply chains will begin to recover in 2022. We believe the company’s strategic goals for 2022-2023 are feasible, especially given the move to GaN-based architecture, which can have a profound impact on cost and performance. However, we assume as the main risk that SolarEdge will be able to recapture some of the market share that Enphase Energy has grown in the US in 2020.