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2022-01-13
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Coupang May Be Out of Favor, but It Isn’t Out for Long
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While it hasn’t rewarded early investors","content":"<html><head></head><body><p>Investors should be bullish about <b>Coupang</b>(NYSE:<b><u>CPNG</u></b>) stock. While it hasn’t rewarded early investors following its massive IPO back in March of 2021, it’s growing. And that’s what growth companies are expected to do. They’re also often expected to post large losses in pursuing that growth.</p><p>That’s particularly true of Coupang. Investor fear around those losses has brought Coupang shares to the $25 range. Some wonder if things will simply continue to get worse. But if you believe they won’t, this is a great opportunity.</p><p><b>Some Sign of Control With CPNG Stock</b></p><p>The basic argument against Coupang is that it is growing, but at what cost? It’s really about continuing losses as much as anything else.</p><p>I’d argue that there’s at least one reason to believe Coupang has reached a turning point. I’m referring to the relationship between revenue growth and losses.</p><p>Generally speaking, when a company’s revenue growth is outpaced by the growth in its losses, that’s a strongly negative signal. And indeed, that’s what happened to Coupang throughout the first nine months of 2021. Revenues grew by 38.5% through Q3. Meanwhile, net losses grew by an astounding 199% in the same period.</p><p>In Q3, that relationship has improved significantly.</p><p><b>Q3 Was Better</b></p><p>Continuing with that idea, revenues grew by 48% in Q3 at Coupang. Meanwhile, net losses increased by 88%. Is that great on an absolute basis? No.</p><p>But does it signify improvement? Yes, it does. It appears that Coupang was improving operationally as 2021 grew closer to an end. It suggests, but does not prove, that Coupang reached an operational turning point.</p><p>Investors should expect the losses to continue at Coupang. But it’s fair to also consider watching that relationship between revenue and losses moving forward. The better it gets, the more attractive CPNG stock becomes.</p><p>There’s another note regarding losses worth considering — a fire that cost the company $296 million.</p><p><b>Fire Losses</b></p><p>On June 17 Coupang suffered a fulfillment center fire that significantly impacted its reported net losses.</p><p>The company did not know whether or not it would receive any insurance reimbursements for the $296 million loss. So,as a result, “The FC Fire resulted in an increase to our net loss of $296 million (“FC Fire Losses”) for the nine months ended September 30, 2021.”</p><p>What that means then is that we can reasonably assume that Coupang’s reported net losses of $1.137 billion might actually be $296 million lower than reported. In other words, if the insurance companies do reimburse Coupang fully for the burned down fulfillment center, its losses should be closer to $841 million through Q3.</p><p>If that is true, then the argument that Coupang is containing its losses becomes better substantiated. In addition to the operational arguments I’m making in favor of Coupang, we should also consider broader factors.</p><p><b>Revenues</b></p><p>Investors have to consider that Coupang is simply growing. No matter what, that’s ultimately important to the company. In Q3, revenues grew by 48%.</p><p>That represents phenomenal growth however one slices it. Coupang has been compared with <b>Amazon</b>(NASDAQ:<b><u>AMZN</u></b>) many times. It’s dominant in its home of South Korea, as Amazon is in the U.S.</p><p>Despite its woes, Coupang is still the leader in South Korea. It’s just that the stock price is down.</p><p><b>What to Do With CPNG Stock</b></p><p>Growth is growth. Coupang has disappointed investors so far, but it is growing. Share prices have come down which suggests that it may soon hit an inflection point.</p><p>I can’t predict a bottom, nor can anyone else. But given that CPNG stock trades so low now, it could be close. Buy now, wait for profitability, and then smile as CPNG stock prices quickly move upward. It may or may not be the next Amazon, but Coupang won’t disappoint forever.</p></body></html>","source":"lsy1606302653667","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Coupang May Be Out of Favor, but It Isn’t Out for Long</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nCoupang May Be Out of Favor, but It Isn’t Out for Long\n</h2>\n\n<h4 class=\"meta\">\n\n\n2022-01-13 13:26 GMT+8 <a href=https://investorplace.com/2022/01/cpng-stock-may-be-out-of-favor-but-it-isnt-out-for-long/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Investors should be bullish about Coupang(NYSE:CPNG) stock. While it hasn’t rewarded early investors following its massive IPO back in March of 2021, it’s growing. And that’s what growth companies are...</p>\n\n<a href=\"https://investorplace.com/2022/01/cpng-stock-may-be-out-of-favor-but-it-isnt-out-for-long/\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"CPNG":"Coupang, Inc."},"source_url":"https://investorplace.com/2022/01/cpng-stock-may-be-out-of-favor-but-it-isnt-out-for-long/","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1127009887","content_text":"Investors should be bullish about Coupang(NYSE:CPNG) stock. While it hasn’t rewarded early investors following its massive IPO back in March of 2021, it’s growing. And that’s what growth companies are expected to do. They’re also often expected to post large losses in pursuing that growth.That’s particularly true of Coupang. Investor fear around those losses has brought Coupang shares to the $25 range. Some wonder if things will simply continue to get worse. But if you believe they won’t, this is a great opportunity.Some Sign of Control With CPNG StockThe basic argument against Coupang is that it is growing, but at what cost? It’s really about continuing losses as much as anything else.I’d argue that there’s at least one reason to believe Coupang has reached a turning point. I’m referring to the relationship between revenue growth and losses.Generally speaking, when a company’s revenue growth is outpaced by the growth in its losses, that’s a strongly negative signal. And indeed, that’s what happened to Coupang throughout the first nine months of 2021. Revenues grew by 38.5% through Q3. Meanwhile, net losses grew by an astounding 199% in the same period.In Q3, that relationship has improved significantly.Q3 Was BetterContinuing with that idea, revenues grew by 48% in Q3 at Coupang. Meanwhile, net losses increased by 88%. Is that great on an absolute basis? No.But does it signify improvement? Yes, it does. It appears that Coupang was improving operationally as 2021 grew closer to an end. It suggests, but does not prove, that Coupang reached an operational turning point.Investors should expect the losses to continue at Coupang. But it’s fair to also consider watching that relationship between revenue and losses moving forward. The better it gets, the more attractive CPNG stock becomes.There’s another note regarding losses worth considering — a fire that cost the company $296 million.Fire LossesOn June 17 Coupang suffered a fulfillment center fire that significantly impacted its reported net losses.The company did not know whether or not it would receive any insurance reimbursements for the $296 million loss. So,as a result, “The FC Fire resulted in an increase to our net loss of $296 million (“FC Fire Losses”) for the nine months ended September 30, 2021.”What that means then is that we can reasonably assume that Coupang’s reported net losses of $1.137 billion might actually be $296 million lower than reported. In other words, if the insurance companies do reimburse Coupang fully for the burned down fulfillment center, its losses should be closer to $841 million through Q3.If that is true, then the argument that Coupang is containing its losses becomes better substantiated. In addition to the operational arguments I’m making in favor of Coupang, we should also consider broader factors.RevenuesInvestors have to consider that Coupang is simply growing. No matter what, that’s ultimately important to the company. In Q3, revenues grew by 48%.That represents phenomenal growth however one slices it. Coupang has been compared with Amazon(NASDAQ:AMZN) many times. It’s dominant in its home of South Korea, as Amazon is in the U.S.Despite its woes, Coupang is still the leader in South Korea. It’s just that the stock price is down.What to Do With CPNG StockGrowth is growth. Coupang has disappointed investors so far, but it is growing. Share prices have come down which suggests that it may soon hit an inflection point.I can’t predict a bottom, nor can anyone else. But given that CPNG stock trades so low now, it could be close. Buy now, wait for profitability, and then smile as CPNG stock prices quickly move upward. It may or may not be the next Amazon, but Coupang won’t disappoint forever.","news_type":1},"isVote":1,"tweetType":1,"viewCount":618,"commentLimit":10,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"symbols":[],"verified":2,"subType":0,"readableState":1,"langContent":"CN","currentLanguage":"CN","warmUpFlag":false,"orderFlag":false,"shareable":true,"causeOfNotShareable":"","featuresForAnalytics":[],"commentAndTweetFlag":false,"andRepostAutoSelectedFlag":false,"upFlag":false,"length":1,"xxTargetLangEnum":"ZH_CN"},"commentList":[],"isCommentEnd":true,"isTiger":false,"isWeiXinMini":false,"url":"/m/post/694540399"}
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