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Overweight Price $ 95.81
At an analyst conference, the retailer said it continues to invest heavily in innovation (e-commerce, modernized businesses, acquisitions). We believe the presentation has demonstrated the ability to balance investment spending with compensating reductions. Walmart US Comp store growth should remain healthy 2.5% to 3%. We also believe that the prospect of a long-term expansion of the Ebitda dollar will push up the price of equities, which in turn confirms our $ 107 price target.
Key Investment Issues: 1) The Company has a strong position in the ability to leverage spending through a combination of budgetary discipline and technology investments that can both bring savings and demonstrate technologies for a better shopping experience. 2) The company's planned 35% e-commerce growth is strong and the playbook continues to evolve. The ramp to more than 2,000 grocery shopping locations has clearly set the goals and goals towards continuing positive trends next year. E-commerce losses will certainly continue, but management appears confident that the cost curve will be reversed (eg a 10% reduction in fulfillment costs this year) and a better margin mix will be achieved. 3) As long as the fight for supremacy in the retail industry continues against Amazon.com, we think we see Walmart as a long-term stock winner.
The acquisition of Flipkart (in India) essentially makes the battle a two-front war (at least), but as in the US, we believe that both companies can win shares from competitors who have no innovation. We are also particularly constructive about Walmart's ability to compete in the grocery retail sector, as its multi-year investments in the closure of fresh food and e-commerce businesses will accelerate
(TRU) and others – which should provide more opportunities for profits from Walmart's core customer base.
At 20 times our estimated 2018 price-earnings ratio and 9.6 times our estimated 2018 / Ebitda, we find the current valuation of the stock attractive.
Buy • $ 384.10 on Oct. 16 by Canaccord Genuity
Following a volatile second quarter report and forecast, Netflix posted strong third-quarter results, with subscriber growth significantly higher above the estimates and favorably lay subscriber guidance for the fourth quarter. This development is in line with the pattern of the last two "net add" failures (second quarter of 2016 and first quarter of 2017), which also belonged to a quarter. The management also informed about the search for CFOs to be completed later this year or in the first quarter of next year. In general, we feel comfortable with our investment thesis, which focuses on a fast-growing catalog of original content, encouraging continued strong subscriber growth. With the stock still 10% below the highs seen before the second quarter, we remain bullish on the stock.
In particular, Netflix has well outperformed expectations of consensus, with domestic net income adding about 435,000 and the international net adding about 1.5 million to the consensus and guidelines. Participant growth was broadly supported in all markets worldwide. Various distribution agreements, including equipment partnerships, billing integration and bundling with TV / Internet service providers, are creating additional demand for Netflix, leading to further streaming acceptance. Also, a strong list of contents probably helped in the third quarter, as Netflix released new seasons from Orange's New Black, Ozark, and Marvel's Luke Cage, . Insane, Disenchantment, Maniac, and Holy Games
We assume that the forecast for the fourth quarter is strong subscriber growth with forecast net growth of 9.4 million, which is more than 20% above the consensus reached this quarter. This level of participation is partially offset by a stronger US dollar, giving some leniency to reported international sales. Management also introduced a first free cash flow outlook for 2019, which resulted in a cash outflow of approximately $ 3 billion given the continued high level of investment in the original content. In a slight change in the way metrics are shared, starting next year, the company will only have paid memberships and no more free trials.
We adjust our estimates. Our target price is $ 470 (versus $ 450), based on 45x our 2024 earnings per share of $ 20.13 (after $ 19.94)
Domino & # 39 ; s pizza
Superior Price $ 259.50 October 16 by R. W. Baird
We maintain our outperform rating and target price of $ 300. Although the third-quarter report did not meet investors' expectations, we considered the results generally sound and [supportive of] our thesis that Domino's ability to maintain strong operating momentum in the fourth quarter and through to 2019 an opportunity to buy the shares.
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