Cripplecat

Long Netflix with a $373 price target, reflecting an 30% return. A recent miss on subscriber net adds and streaming announcement of several large competitors led to disappointing stock performance that has helped the stock come down from irrational valuation levels. This research explores whether Netflix can sustain its subscriber growth to justify its current valuation.

A Summer project focused on Netflix. Thank you to the team at Artisan Partners for the experience.

Long Meituan Dianping with a $112 HKD price target, reflecting an 87% return. Meituan’s value is driven by growth in its food delivery GTV and path to monetization and cross-sale opportunities. The company’s IPO in 2018 was accompanied with the news of Alibaba’s acquisition of Ele.me (its main competitor).  Concerns with competition from Alibaba led to suppressed valuation for the fast-growing tech company. Trade war headlines also irrationally affected its valuation in December even though it has no exposure to international trade. Headline news seems to have clouded the market’s view on what I believe is a sustainable moat. With the recent industry consolidation, Meituan’s management team has shown ability and willingness to further monetize its growing GTV.  

Frontdoor, inc. operates a home services platform that provides home service plans to homeowners in the United States. It provides services under the HSA, OneGuard, Landmark, and American Home Shield brand names. The company serves homeowners who require assistance with technical home repair issues by utilizing its network of pre-qualified professional contractor firms. Frontdoor primarily derives revenue from three channels: existing contract renewals, selling as part of a real estate transactions, and selling direct to consumer (DTC). With 30% and 50% of the real estate and DTC market share, respectively, Frontdoor and its American Home Shield brand is by far the largest player in home warranty market.