We are trying a new format: market news for portfolio companies, in both podcast and written form. Would this add value to you? Let us know.
Good morning, and welcome to StockOpine. Here's your essential briefing on the portfolio news you need to know.
Ashtead
Ashtead reported solid Q1 results. Revenue grew 2% to $2.8B, with near-record free cash flow of $514M. EPS came in at $0.875. They reiterated their full-year rental revenue growth guidance and lifted their free cash flow guidance by $200M. The $1.5B buyback continues as planned.
This is a strong report in a tough market.
Alphabet
A federal court judge issued a major antitrust ruling. Google will not be required to sell its Chrome browser or Android operating system but must end some exclusive search deals. Several analysts raised their price targets following the news.
This is a best-case scenario as the market was fearing a forced breakup of the company.
Advanced Micro Devices
Management confirmed the MI350 AI chip is ramping significantly and that they have more than 40 active engagements for 'Sovereign AI' deals globally. They are prioritizing gaining market share and providing better TCO for customers but protecting gross margins, although it might be dilutive at the beginning.
Their strategy to focus on market share now by offering competitive pricing (not only performance) seems the right move in a hyper-growth market to increase GP dollars.
Booking Holdings Inc
Speaking at a conference, management highlighted that "Connected Trip" bookings are now in the low-double-digits of total transactions and are growing 30-40% every quarter. They also noted that Generative AI is already providing clear economic benefits by lowering customer service costs.
The Connected Trip is becoming a contributor, which is great for increasing customer value and loyalty.
Crocs
In a conference appearance, the CEO confirmed a cautious Q3 outlook (sales expected down 9-11%) as they strategically reduce discounts and clean up HEYDUDE inventory. They also flagged a potential $90 million headwind from tariffs next year.
Crocs has challenges and they are sacrificing short-term sales to protect long-term brand health. International growth remains the bright spot.
Other Portfolio Updates
Meta Platforms Inc Hired Apple's Robotics AI chief, a significant talent win for their AI ambitions. They also announced a dedicated Instagram app for iPads is coming.
Amazon.com Inc Facing a new class-action lawsuit covering 300 million shoppers over alleged price-inflating policies. A headline to watch.
PayPal Holdings Partnering with AI-browser Perplexity to offer a free one-year trial to PayPal/Venmo users, a nice perk to drive engagement.
Allegion Upgraded to "Strong Buy" from "Buy" by CFRA with a new price target of $207.
That's a wrap. See you soon.
