Sectors: Technology
Electronic design automation software (EDA) business ALU has managed to bounce 18% from its panic June low but like other quality tech stocks it remains significantly below its late 2021 high. We like this quality business which already pays a ~1.5% fully franked yield but it’s priced for growth trading on an Est P/E valuation of 53.7x for 2022 making it likely that sellers will re-emerge in the low to mid $30 region.
MM hasn’t significantly altered our stance towards XRO, we like this online accounting business but we remain mindful of further value compression if / when bond yields again start to rally in the months ahead. It all comes down to valuation and its expensive on many metrics as they continue to invest heavily for future growth.
EML +10.51%: a strong day for the payment card company, initially catching a bid with the broader tech sector, but spurred on with a strong contract win. Tech was well bid today as investors added duration to portfolios with bond yields falling. Mid-morning, EML announced it had secured a deal with Spain’s postal service to supply 500k preloaded cards, each with €500, totalling around $320m worth of deposits. The offer is for younger…
The world has changed, technology is driving all businesses and underpinning that is data. Snowflake (SNOW US) is a very interesting US-listed data business that came to market when technology was running hot in late 2019. The IPO had the who’s who of investors and it did spectacularly well, doubling in short succession. Since then it has fallen away on the broader tech sell-off, however, this is a business…
Wednesday’s 3% fall by REA would make it appear likely to have been one of a number of funding vehicles used to buy into the $1.2bn carsales.com (CAR) capital raise. Unfortunately from a buyer’s perspective it’s still well above its recent low, we like this business and if it does surprise us on the downside when it reports on the 6th of August, this is one growth company MM would be happy to buy into further weakness.
XRO has gone from hero to villain in a very short space of time as highly priced growth stocks have suffered under the weight of huge value compression. Similar to RMD we like our position in XRO, but it feels on the large side in the current economic environment hence we will consider reducing our exposure into further strength.
Zillow Group, Inc. helps people find and get the home they want by connecting them with digital solutions, partners, and agents, and buying, selling, financing, and renting experiences. The Company’s affiliates, subsidiaries and brands include Zillow, Zillow Premier Agent, Zillow Home Loans, Trulia, Out East, StreetEasy, HotPads, ShowingTime+, Spruce, and Follow Up Boss. It provides integrated transaction experience for movers through Zillow, its network of partners, its affiliated brands, and through a comprehensive suite of marketing software and technology solutions for the real estate industry, including Spruce, Mortech, New Home Feed, ShowingTime+ and Follow Up Boss. Its services are primarily designed for buyers, sellers, partners, renters, and borrowers. For customers who are focused on buying new construction homes, it connects them with its home builder partners. Its rentals marketplace assists its partners with listings, advertising, leasing, and property management services.
Sea Limited is a consumer Internet company. The Company operates across three business, namely digital entertainment, e-commerce, as well as digital payments and financial services. Its businesses include Garena, Shopee, and SeaMoney. Garena’s platform offers mobile and personal computer (PC) online games and develops mobile games for the global market. It offers e-sports and provides access to other entertainment content and social features, such as live streaming of gameplay, user chat and online forums. Shopee’s platform is a mobile-centric, social-focused marketplace. It provides users a shopping environment with integrated payment, logistics infrastructure and seller services. SeaMoney provides various payment services and loans to individuals and businesses. It also integrates with third party merchant partners and covers a set of consumption use cases. It operates in locations, such as Indonesia, Taiwan, Thailand, Singapore, Malaysia, and the Philippines, among others.
Qualcomm Incorporated is engaged in the development and commercialization of foundational technologies for the wireless industry. The Company’s segments Qualcomm CDMA Technologies (QCT), Qualcomm Technology Licensing (QTL) and Qualcomm Strategic Initiatives (QSI). QCT segment develops and supplies integrated circuits and system software based on third generation/fourth generation/fifth generation (3G/4G/5G) and other technologies for use in wireless voice and data communications, networking, computing, multimedia and global positioning system (GPS) products. QTL Segment grants licenses or otherwise provides rights to use portions of its intellectual property portfolio, which, among other rights, includes certain patent rights essential to and/or useful in the manufacture, sale and/or use of certain wireless products, including, without limitation, products implementing CDMA2000, WCDMA, LTE and/or OFDMA-based 5G standards and their derivatives. QSI Segment makes strategic investments.
Mastercard Incorporated is a technology company that connects consumers, financial institutions, merchants, governments and businesses across the world, enabling them to use electronic forms of payment. It allows users to make payments by creating a range of payment solutions and services using its brands: MasterCard, Maestro and Cirrus. It enables a variety of payments capabilities (including products and value-added services and solutions) over its multi-rail network among account holders, merchants, financial institutions, businesses, governments and others, offering customers one partner for their payment needs. Its products include consumer credit, consumer debit, prepaid, B2B accounts payable, commercial point of sale, disbursements and remittances, and others. It offers additional payment capabilities that include automated clearing house (ACH) transactions (both batch and real-time account-based payments). It also offers other services, such as cyber and intelligence solutions.
