Bad Chart Big Risk Why Do I Like GMKT?
This review is dedicated to Biobottom.
Monday, March 12, 2007
comments this AM comes from Goldman Sach's Asia team on Gmarket (NASDAQ:GMKT):
GSCO notes Gmarket's GMV guidance miss in 4Q06 disturbed them. However they view Gmarket's enterprise value of $0.6 bn as unduly small relative to the franchise value of being Korea's largest e-commerce business growing at 2X-3X the pace of the e-commerce industry with the 7th most visited website in Korea, 11 mn active users, turnover last year of $2.4 bn, revenue last year of $164 mn, revenue growth last quarter of 67% yoy, and earnings growth last quarter of 78% yoy. Firm believes that Gmarket can fundamentally earn its way back to a $20-plus stock price by reporting GMV consistent with its guidance, starting with 1Q07 GMV out either in April or upon full results on May 9.
GSCO sees 3 non-earnings developments which might assist the stock:
1) Yahoo! or eBay could buy stock in Gmarket: eBay acquired prior market leader Internet Auction, and Yahoo! paid $13.30 per share for 4.5 mn Gmarket shares in June 2006. With GMV around one third that of Yahoo Japan and 3X faster growing, and GMV slightly larger than Taobao, the firm views Gmarket as complementary to Yahoo's Asian marketplaces.
2) Gmarket could boost its e-commerce share and leverage its platform by acquiring smaller Korean marketplaces.
3) Gmarket could coordinate any overseas expansion with Yahoo!, which controls the largest marketplaces in Japan, China, and Taiwan.
GMKT is one of the more interesting e-commerce plays outside of the U.S. The stock got hit last Friday after reporting weaker than expected results but managed to bounce nicely during the day. Note that GSCO has a Buy and $21 tgt on the stock.
ALSO:
POSTS $0.13 Q4 EPADS. RBC CAPITAL CUTS ESTS, TARGET, BUT MAINTAINS OUTPERFORM
S&P Marketscope - March 09, 2007 3:19 PM ET
Related Quotes
Symbol Last Chg
GMKT Trade 15.46 +0.08
Real time quote.
>Analyst Stephen Ju tells salesforce GMKT hit first speed bump in its life as public co., as decreased consumer activity, warmer weather in Q4 caused it to miss its gross merchandise value (GMV) guidance... Also notes gross margin fell vs. prior Q, hurt by reclassification of certain costs, consumer reward marketing activities... Cuts $0.73 '07 EPADS est. to $0.68, $0.86 '08 to $0.75; $27 target to $20... But despite Q4 miss, notes co. now commands 19% share of Korean e-commerce... Maintains outperform, as feels asset value, high-growth outlook in GMV, rev. still intact.
>> so we have a $27 target lowered to $20 never good. And another price target remaining firm at $21. Let's assume the Roth $27 was unrealistic and merge the new Roth with the Goldman PT's and come up with $20.50. Now look at a chart not the 3 month! You'll jump off a cliff- like the stock did! Lok at the 1 year and see how it's fallen back into a safe base. If this really was a one time miss it looks like a good investment down here.
~ stoney
This review is dedicated to Biobottom.
Monday, March 12, 2007
comments this AM comes from Goldman Sach's Asia team on Gmarket (NASDAQ:GMKT):
GSCO notes Gmarket's GMV guidance miss in 4Q06 disturbed them. However they view Gmarket's enterprise value of $0.6 bn as unduly small relative to the franchise value of being Korea's largest e-commerce business growing at 2X-3X the pace of the e-commerce industry with the 7th most visited website in Korea, 11 mn active users, turnover last year of $2.4 bn, revenue last year of $164 mn, revenue growth last quarter of 67% yoy, and earnings growth last quarter of 78% yoy. Firm believes that Gmarket can fundamentally earn its way back to a $20-plus stock price by reporting GMV consistent with its guidance, starting with 1Q07 GMV out either in April or upon full results on May 9.
GSCO sees 3 non-earnings developments which might assist the stock:
1) Yahoo! or eBay could buy stock in Gmarket: eBay acquired prior market leader Internet Auction, and Yahoo! paid $13.30 per share for 4.5 mn Gmarket shares in June 2006. With GMV around one third that of Yahoo Japan and 3X faster growing, and GMV slightly larger than Taobao, the firm views Gmarket as complementary to Yahoo's Asian marketplaces.
2) Gmarket could boost its e-commerce share and leverage its platform by acquiring smaller Korean marketplaces.
3) Gmarket could coordinate any overseas expansion with Yahoo!, which controls the largest marketplaces in Japan, China, and Taiwan.
GMKT is one of the more interesting e-commerce plays outside of the U.S. The stock got hit last Friday after reporting weaker than expected results but managed to bounce nicely during the day. Note that GSCO has a Buy and $21 tgt on the stock.
ALSO:
POSTS $0.13 Q4 EPADS. RBC CAPITAL CUTS ESTS, TARGET, BUT MAINTAINS OUTPERFORM
S&P Marketscope - March 09, 2007 3:19 PM ET
Related Quotes
Symbol Last Chg
GMKT Trade 15.46 +0.08
Real time quote.
>Analyst Stephen Ju tells salesforce GMKT hit first speed bump in its life as public co., as decreased consumer activity, warmer weather in Q4 caused it to miss its gross merchandise value (GMV) guidance... Also notes gross margin fell vs. prior Q, hurt by reclassification of certain costs, consumer reward marketing activities... Cuts $0.73 '07 EPADS est. to $0.68, $0.86 '08 to $0.75; $27 target to $20... But despite Q4 miss, notes co. now commands 19% share of Korean e-commerce... Maintains outperform, as feels asset value, high-growth outlook in GMV, rev. still intact.
>> so we have a $27 target lowered to $20 never good. And another price target remaining firm at $21. Let's assume the Roth $27 was unrealistic and merge the new Roth with the Goldman PT's and come up with $20.50. Now look at a chart not the 3 month! You'll jump off a cliff- like the stock did! Lok at the 1 year and see how it's fallen back into a safe base. If this really was a one time miss it looks like a good investment down here.
~ stoney
