We first covered MercadoLibre in March 2023. We talked about Alibaba meeting Amazon in Latin America. Mostly, we were just highly impressed with the cohesive ecosystem that the company has built. We were also big fans of the commitment to profitability, something that many tech companies could learn something from. With Argentina in the headlines and renewed focus on the broader LatAm region, how has the business performed this year?
Welcome to episode 149 of Magic Markets. It’s the middle of US earnings season, and two international tech giants have released results last week. This is a tale of two stocks, with one garnering a very positive reaction from the market and the other… well, not so much. Join us as we discuss Amazon and Alphabet (the holding company of Google).
Dollar General was a darling of the market for the past decade. In a classic example of how quickly a retailer can be humbled by the market and competitive forces, the share price has collapsed this year and there are good reasons why. Far from being a bargain, we think the pain is only just starting. With a strategy that seems certain to cause a structural drop in margins, Dollar General is in trouble.
Kroger is the OG - Original Grocer! With a history of organic growth and M&A to supplement the story, Kroger has now embarked on the biggest acquisition in its history: the proposed merger with Albertsons. It introduces a lot of risk into the mix, but can it propel the share price CAGR above the index and make this a worthwhile stock to hold?
Home Depot is the eCommerce hero that nobody talks about. There are a lot of surprises in this business, with long-term financial performance telling a wonderful story. This is going to be a disappointing year vs. FY22, but is that perhaps an opportunity?
Use the podcast player below to listen to our discussion on MercadoLibre and its Q4'22 result, which accompanies the detailed write-up below: (Date of report: 2 March 2023) In 2022, MercadoLibre achieved three big milestones that they describe as 100, 10 and 1. That means $100 billion in payments processed, $10 billion in revenue and $1 billion in EBIT. Latin America’s leading eCommerce platform is more than just Amazon or Etsy. There’s a strong flavour of Tencent going on here, which isn’t a bad thing. Perhaps most of all, the similarities to Alibaba are striking. Operating in a high growth region [...]
Use the podcast player below to listen to our discussion on Tesco and its Q3'23 result, which accompanies the detailed write-up below: (Date of report: 19 January 2023) Grocery retail isn’t the most exciting industry, let’s face it. Nevertheless, these companies are defensive investments that are theoretically good punts in tough times. As we’ve seen before, the theory and the practice aren’t always aligned. In Tesco, we find a UK retailer that has a history of strategic missteps. Of course, at the right price, almost anything is a buy! In analysing Tesco, we also highlight some stark differences vs. the US [...]
Use the podcast player below to listen to our discussion on Apple and its Q4’22 result, which accompanies the detailed write-up below: (Date of report: 17 November 2022) Without a doubt the best global example of how tech hardware and services combine to form a powerful ecosystem, Apple is the most valuable company in the world and deservedly so. Originally built through revolution, the company is now all about evolution. Is that its greatest strength, or perhaps its most significant vulnerability? We unpack the company that brushed off a pandemic to achieve the best recent returns in the tech industry. Elevator [...]
Use the podcast player below to listen to our discussion on Amazon and its Q3’22 result, which accompanies the detailed write-up below: (Date of report: 10 November 2022) What started out as “Earth’s Biggest Bookstore” is now estimated to have gross merchandise value ahead of Walmart, with a big chunk of sales from third-party sellers who use Amazon as a marketplace. The retail side of the business is loss-making again. Amazon Web Services (AWS) is making the money, with all eyes on cloud growth and the advertising business within Amazon’s retail operations. The group is a perfect case study of the [...]
Use the podcast player below to listen to our discussion on Dick's Sporting Goods and its Q2’22 result, which accompanies the detailed write-up below: (Date of report: 15 September 2022) Dick’s Sporting Goods is the largest independent sporting goods chain in the US. The business has aged far better than its name, although it is now facing the challenges of the direct-to-consumer strategy being put in place by giants like Nike. This business was an undercover winner of the pandemic, achieving sales and margins that nobody had dreamed possible for Dick’s. The earnings before tax in the latest quarter were higher [...]