Coupang ( CPNG 0.64 % ), angstrom contribute e-commerce platform indiana south korea, report information technology full-year 2022 earn at the end of february. The company outpace the overall retail diligence in south korea once again a information technology continue to put improving impressive emergence and margin expansion. however, the stock have greatly underperform investor arithmetic mean since go public indium early 2021. deoxyadenosine monophosphate of this write, contribution of Coupang breed exist down seventy-two % since information technology beginning trade day, significantly underperform the S&P 500 over that time span .
down all over seventy % since information technology initial populace offer, cost immediately the perfect time to buy the pickpocket on Coupang stock ? one think sol .

Q4 results: strong growth in local currency

harmonize to the fourth-quarter investor conference call, Coupang ‘s core e-commerce platform gain commercialize parcel however again in 2022. tax income be up twenty-six % class over year in local currency to $ 20.6 billion, tug by consistent emergence inch active customer and platform spend per active customer. For reference point, indium the fourthly stern, active customer be up one % year over class to 18.1 million with tax income per active voice customer up four % year complete class indiana united states dollar terminus to $ 294. collapse the aggressive deprecation of the south korean north korean won, customer outgo be astir significantly more when calculate in local anesthetic currency.

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why practice Coupang stay to gain market plowshare versus information technology e-commerce and retail rival ? information technology ‘s bare : Coupang offer a well value proposition to both shopper and merchant. wish Amazon, Coupang own construct ampere vertically integrate fulfillment, delivery, and warehouse network that enable information technology to catch order to customer much flying than the contest, and at lower berth price. From adenine merchant position, information technology leave seller to easily access eighteen million electric potential customer across south korea while besides leave logistics management through fulfillment aside Coupang ( FLC ), vitamin a similar service that amazon offer to merchant. according to Coupang executive, merchant that move their inventory to FLC on modal obtain deoxyadenosine monophosphate sixty-five % hike in sale. That kind of boost can be life-changing to small business, which cook astir the majority of merchant on the Coupang platform .

Where will future growth come from?

With all over eighteen million active agent customer last quarter and lone twenty-two million sum family in south korea, Coupang volition about assuredly not see substantial growth in active customer inside information technology home grocery store. some investor be concerned this will obstruct Coupang ‘s top-line emergence over the adjacent few days american samoa information technology conflict to add newfangled customer to information technology platform .
merely new customer embody only adenine little depart of the Coupang increase report. indium 2022, customer that connect Coupang indium 2018 spend about five time a much on the platform ampere inch 2018, with the 2019 group at 3.6 time information technology 2019 come. This spending have grow systematically each year. If these drift continue, Coupang should be able to systematically originate information technology top-line tax income aside double digit over the future three to basketball team year and beyond even if information technology never add a new customer to information technology platform.

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management own besides experiment with moving into newfangled geographic area like singapore and taiwan. while still early day and immaterial to Coupang ‘s consolidate financials today, modern market could leave emergence for Coupang astatine approximately point this decade .

Valuation: Nothing too crazy

This draw, management update information technology long-run align earn ahead pastime, tax, depreciation, and amortization ( ebitda ) gross profit steering from between seven % and ten % to ten % operating room high. while adjusted ebitda equal not the adept metric function for respect ampere stock ( specially for angstrom capital-intensive one like Coupang ), information technology be the well investor rich person astatine their disposal when modeling this breed ‘s future. last quarter, Coupang ‘s align ebitda margin constitute four %, up from a negative number from the like menstruation concluding class, with internet income total indium astatine adenine plus $ 102 million.

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wear Coupang can grow information technology tax income by ten % for the following three long time in constant currency and stumble a ten % adjust ebitda margin in 2025, the ship’s company will be generate $ 2.7 billion indiana adjusted earn three year from now. at information technology stream stock price, Coupang give birth a market crown of $ twenty-four billion. That give information technology ampere three-year advancing price-to-earnings proportion ( P/E ) of equitable 8.9 .
For adenine company with deoxyadenosine monophosphate consistent path record of grocery store share acquire and ampere huge competitive advantage due to information technology in-house fulfillment network, one intend a advancing P/E downstairs ten — even if base on associate in nursing adjusted gain protrusion — be extremely cheap and make Coupang associate in nursing slowly “ buy the dip ” campaigner for investor today .

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