New Street Research - GoTo Group (1927070D) New Street: GOTO 3Q22 Results - Accelerated Path to Profitability

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New Street Research

Jin Yoon

New Street: GOTO 3Q22 Results - Accelerated Path to Profitability

What's new: Margins continue to improve as 3Q contribution margin came in above our expectations and above the previously guided range. Company-level contribution margin breakeven timeline could come in 1-2 quarters ahead of the initial guidance driven by continued cost control initiatives. Despite the positive margin outlook, we remain cautious as execution could be an opportunity (or a concern) whether the group would be able to maintain market share without having to remain aggressive in promotions/subsidies in a price sensitive environment. We lower our PT from IDR295 to IDR190 and maintain our NEUTRAL rating. Our revised PT of IDR190 implies a 12.1x FY23 EV/Rev.

Analysts:
Jin Yoon

25/11/2022 1 EN

Underlying

GoTo Group

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New Street Research

Provided by our team of experienced analysts, our work is idea driven, based on independence of thought, sector expertise, and firmly focussed on fundamentals and valuation.

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Pan European Telecom Services and Cable
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Pan European Telecom Services and Cable

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Analysts

Jin Yoon

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GOTO 1Q23 Results: Growth to Moderate in 2Q

What’s New: Churn in lower quality users, tougher comps coupled with macro uncertainties could mean that growth may continue to moderate in 2Q. While near-term top-line visibility remains limited, margin guidance remains intact where group-level adjusted EBITDA would continue to improve QoQ and turn positive within 4Q23. We maintain our PT at IDR 115 and maintain our NEUTRAL rating. Analysts: Jin Yoon

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What's new: Margin guidance remains intact where contribution margin could turn positive within 1Q23, and group-level adjusted EBITDA would gradually improve QoQ to turn positive within 4Q23. While margin outlook is encouraging, we are cautious on the execution as challenges remain to maintain market share without having to remain aggressive in promotions in a price sensitive environment. We lower our PT from IDR 130 to IDR 115 and maintain our NEUTRAL rating. Our revised PT of IDR 115 implies a 6.2x FY23 EV/Rev. Analysts: Jin Yoon

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New Street: GOTO 3Q22 Results - Accelerated Path to Profitability

GOTO 1Q23 Results: Growth to Moderate in 2Q

GOTO: 4Q22 Results - Margin Guidance Intact

GOTO 4Q22 Updates: Positive Adjusted EBITDA By 4Q23

SATS, Carr, and the Art of the No Deal…Yet

Supreme Court Upholds USF Framework but Reform Still Ahead

CMCSA quick hit: Comcast continues to make the right pricing moves

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