저자: Vinnie · 외국인
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JD.com 심층 분석. 마이클 버리의 매수 보도와 최근 실적을 검토. 매출 성장 둔화(3.7%), 낮은 영업이익률, 자사주 매입 여력 대비 실행 부진(잉여현금흐름의 약 11%)을 지적하나, 잉여현금흐름 수익률과 배당 중심 주주환원을 근거로 소액 매수 시작을 밝힘. 중국 거시·지정학 리스크는 분석 대상 외로 언급.
다듬은 글
jd.com a little bit more in depth analysis than my prior video as you know Michael bur reported owning it his most recent quarterly filing he's been buying more and more shares I am starting to get a little interested in buying some shares so I wanted to do a in-depth analysis about a.com and see whether or not it's a buy at this point in time so we will hear if you will buy it we will two STS with 18 pages of caveats okay 18 pages of caveats for those of you who don't know Vinnie doesn't buy so if Vinnie buy something it's big deal yeah I go a little slow with this but you know when you look at an alltime chart of JD me basically up 23% since they went uh public as an IPO like you know the the stock has gone full circle you know the 360 come back to where it started it's crazy um over the past year it's down like 40% it was actually 45% as of a few days ago before they get this nice bump here post earnings um I'm G to kind of break down the most recent quarterly earnings a little bit in terms of um my read on them but brief history I thought this was kind of interesting from their website when they describe themselves they describe themselves as a supply J uh chain based technology and service provider not an e-commerce company they really focused on the fact that they're like a supply chain manager more than any else and of course they word technology in there well they're supplying the public with things they need yeah there you go yes kind of works yeah totally yeah like basic things like groceries um but you know to the rest of the world they're a China based e-commerce company based in Beijing uh founded in the late 90s 1998 um I'm not even going to attempt to pronounce this uh name correctly uh but the the founder is now the chairman he's got a net worth of about 4.9 billion um you originally started actually as you know brick and water re uh resale or uh retail locations and ultimately moved online after the U aars outbreak back in 2003 that's what prompted them uh so it's kind of interesting from that standpoint um you know largest Chinese e-commerce company and by Revenue globally number 42 about the same size is Home Depot which for us a westerners is a household name and drone airport I feel like that should be in there yeah I didn't even mention that they don't even care they don't talk about it that much actually from a revenue growth standpoint you know they did of course had to like cherry pick some data went back to 2018 here and showed that they had a 19% Kar over that time which is you know a big number but you know what it's always kind of what have you done for me lately is the real question and you look at the the flattening of the uh kind of uh graph here as we move towards the more recent years so you know the Chinese mecro environment is not something I'm want to talk about in this video but obviously it's a very challenging environment right now they've all talked about that every retail company in China yeah China's like shut down they're like hardcore shut down multiple times like they've been shut down for like I don't know I think they're open now but they've been shut down for way longer than everyone else so yeah yeah yeah exactly and you know this is an actually interesting Trend here a little bit too so you those of us that are Alibaba shareholders and kind of more familiar with them know they have been more of a platform company and transitioning to being the retailer ultimately of themselves a little bit more often now over time um because necessity whereas uh JD is kind of had the opposite Trend where they were the retailer originally and now they're trying to move towards more of a plat with they're having more and more uh kind of retailers on their platform uh so that's why they're bringing up these two different bars here if you actually W look at the growth here in um their platform kind of side of their business as opposed to them being the primary retailer which is the red bars okay yeah interesting yeah um as far as like the product category Revenue I didn't really go into this too much because it doesn't matter to me what you sell it matters how much money you can make on what you sell all right doesn't matter at all no I don't care yeah well as long as it's legal I guess selling people but okay never mind well yeah um much like uh kind of Al Baba they do have multiple different business segments but really like only one or two of them even matter at all okay that I I've noticed this kind of uh bloat amongst Chinese e-commerce companies where they want to have multiple businesses and multiple different business business segments but most of them don't do anything really constructive right GD retail is like the business by far yeah um yeah they have the logistics arm which is you know got some solid growth be but look how much this contributes to to the actual operating profit fortunately it's profitable but barely anything at all you know it's not a significant mover you know they always have their other bets sort of unit is I like the Google terminology for that is you know other things we're working on but probably won't become anything and we're going to lose money on them for a long time so but that that's the segment of the business for them do do they the same thing that like Al Bama does where they have like like a animal logo for each company it seems like it is that a Chinese thing I think it's a Chinese thing um you know the one kind of I guess not one but one of the worrying things about JD is they really have a pretty thin profit margins here um looking through their financial statements they much more reminded me of Walmart which ironically is a shareholder of theirs I don't know if you knew that um but it we looked at kind of profitability of American companies in this post-inflationary time period uh you're looking at a lot of these major retailers having these little 2% like profit margins like not great numbers at the end of the day they have big Revenue but they're not delivering a lot of it to the bottom line because you know delivering physical goods and that costs money to produce and that costs money to like you know ship and then manage the customers which is really where their focus has been of late so you know not going to get rich overnight with having like a meta where you have like a 80% profit margin they're completely different business models but they've still been managing to you know kind of produce Some solid cash flow over the years here okay uh so this is in uhii so you know but you are seeing significant growth over time um free cash flow is same they don't have to invest a lot back into their platform to continue operating every year so you're looking at see a little bit under 60 billion maybe last year um and then 18.4 they had to reinvest so as far as how much of their cash flow is f falling through to shareholders it's a decent margin there you're talking about 65% or so right about two-thirds of that ultimately ends up hitting the bottom line that can be used for things that we love like Sher purchases and stuff like that which they did do yeah yeah yeah I'm gonna give you some caveats on that though oh man so financial highlights uh 5.7 billion USD of free cash flow the last 12 months right it's a good it's a good number especially We compare it to their market cap Revenue growth was only 3.7% um not phenomenal but you know definitely challenging macroeconomic environment I completely con seeed that I'm not going to do any macroecon EIC predictions for the Chinese economy here that's not the point of this um did have $ 150 billion doll Plus in USD like I said this ranks just behind uh Home Depot the they did declare a dividend the most recent quarter 76 cents per uh ads um this payable I think it was like in April so you still have time to buy shares if you want to get this dividend they did have their old share repurchase program which is expiring on St Patrick's Day 317 um and as of the most recent reported quarter that had about $1.5 billion of this share repurchase program unused which is not something that sounds very nice to me so yeah yeah but I they have to use it then right oh unless they did a new plan and extended it so that's what you're talking about God damn it yeah they looks like they're letting the old plan expire and there going to be a portion of it that was just unused and now they have a new plan that is approved that will go forward for the next 36 months that has basically $3 billion in total or a billion dollars per year so I looked at the kind of most recent quarterly uh you know free cash flow here and they had about $1.8 billion USD free cash flow last quarter they only used about 203 million dollars of that in for share BuyBacks about 11% of their free cash flow that's not good yeah that's not great it's not great now there's a lot of considerations with getting cash off shore you know from these Chinese kind of companies and through the vi structure um alib Baba's been really direct about it and you know talked answered questions and kind of talked about the strategies they can employ to do that uh I've only listened to one conference call so far for JD so nothing like that was discussed in there so that makes me a little bit worried but um you know as far as their effectiveness of their share repurchase program here compare the shares outstanding count from JD and Alibaba which one is being more effective in in repurchasing their shares so I mean it is Alibaba however the scale is different on each one one is going up by 0 2 one's going up by 0.1 and more zoomed in so there's that that yeah for total shares outstanding I agree entirely but you are definitely looking at a overall trend that is very different if you slide yourself over here slightly you'll see the like the the kind of quarter over quarter decline that Ali bab has been managing to achieve with their shery purchase program and uh when you compare that to JD it's not even close like you know they're still having you know kind of quarters that are ultimately share outstanding positive we're going to talk a little bit about share based compensation here in a second so this is my notes from the conference call here all right they're really focused on improving the quality of their customer service all right this is very much early day Amazon Jeff Basil's kind of mindset where you're trying to do everything you can to make sure that customers enjoy their experience with you and come back more and more frequently right and I get and respect that you know they talked about some of the programs they're using to do that where they're having you know lower uh kind of you know order Vol um sorry um uh cost in order to have like a a lower free shipping kind of cut off offs and having um you know kind of returns that are El will be picked up right from your doorstep and yeah sounds like from from a customer perspective that they're doing some solid work there and then they did see some results from that in terms of people having a more frequent like ordering uh Behavior which is good um but know at what expense right you know are these going to be able to deliver this down to the bottom line that's a different question um they didn't seem to have any like major projects going on you know if you talk listen to like you know like a like a I don't like I'm a meta Fanboy over here but if you listen to them you know they obviously have kind of stuff that going on in the background it's like oh like you know um how you doing like the metaverse and the VR things and like how's your AI system you know kind of progressing and you know where do you see the future of generative eye there was nothing like that this is like very much like cut and dry boring retailer conference call okay question does Ali Baba do the same no no because they talk about ali cloud and they talk about a lot of their their plans for Global expansion they they had one touch on um kind of expanding internationally and it was kind of like yeah when we see an opportunity we go for it that was literally like the end of it it was not very engaging so two ways to interpret that from someone who has done zero research and did not listen to the earings call uh one the negative side is you can say like just the retail everything you just said the positive side is they're not branching out they're perfecting one area before they move on to another one yeah I I do like that know it sticking to your what your core competency is definitely an important thing to do um you know it definitely hearkened back to that Charlie M quote about it's definitely just a retailer I mean he was talking about Alibaba at the time but like that applies to JD once more than it does to Alibaba but yeah whatever um now as far as their Capital return this was a question that was asked you are looking at about $1.2 billion total dividend payment here okay and they do expect it to grow meaningfully year-over-year I want to say it was 14% increase year-over-year for the most recent one that was just declared and they do have this about a billion dollars in USD share by back per year however in the last 12 months they had you know a little Shor of $700 million in stock based compensation and then you kind of wonder why the the share count barely has moved at all despite their share buyback of a billion dollars a year they're basically this is not a share buyback that is going to be you know meaningfully accretive to to shareholders this is just you know controlling the the shares outstanding from you know increasing significantly over time in my opinion but this is where the numbers get so crazy is that you know $1.2 billion dividend and I know was like $323 million in the share buyback the net effect it's still $1.5 billion coming back to um you know shareholders here and when you when you back that out and look at an Enterprise Value because they have so much cash and uh short-term Investments on their balance sheet it's still paying effectively almost a 9% yield just in those two modalities alone never mind their ability to you know invest internally which is you know like many Chinese companies that have done share bu BuyBacks not great you're looking at single digit return invested capitals here which is unfortunate okay but that's about double what alibaba's is when you calculate on the same basis here D yes okay it is but you're G to be getting most of that in the for of dividend okay so that needs that that's what you have to expect not share B back it's going to be mostly paid out in dividend it's it's really a dividend company so sell all my TLT by JD is what I'm getting all right interesting so I went through some free cash flow yield count calculations here so this this is the outstanding market cap this is what Google gave me this is what CNBC gave me I end up going with the higher one just to be have more conservative numbers um you know like said this this 5.7 billion in TR 12 months for cash flow is directly from their financial reports themselves I didn't calculate that these are also from their balance sheet they had $1.1 billion in cash cash equivalents 6.65 six billion dollar in short-term Investments they didn't clarify what that was I mean typically in the US companies there like government issued T bills and things like that um I looked for it in the their financial documents to see if they ever disclos exactly what it was but I didn't see it um you know it's something I want I'd like to look more um do have about $4.4 billion in debt on the business um it's giving them this net cash position is $22 million so when you're looking at calculating Enterprise Value you basically are going to subtract that number from the market cap because that's what the actually you know the business itself is worth the Enterprise right uh and using that based upon the most recent kind of um you know market caps we get a 33% free cash flow yield if you were to believe that number but like I said only 88.8% of that is being delivered back to shareholders in terms of buyback net buyback and um the uh dividend so okay yeah yeah definitely interesting I me still great numbers it's not as great as the video that we had yesterday with the preliminary look yeah yeah well part of that is like you know they did have kind of a stock rebound a little bit and in this case I'm kind of really discounting from a standpoint of the share base compensation now you know this is all you can calculate this many different way someone someone had criticized and critiqued them back down there I'd love to kind of talk more about the Nuance of it um because obviously there's many ways to do this it's just a way for me to kind of get a grasp on how much money I feel like they're returning per my investment that's why I use this calculation method um but this is still in the realm where to me um I think I'm going to start building a starter position here so I'm gonna buy a little bit a little bit okay I am not going to go crazy you know there's a of kind of overlapping risk from a standpoint of being Alibaba shareholder and then adding other Chinese Equity especially individual Chinese Equity that I'm at risk for um you know some kind of U what's what I want to say here uh concentration of risk right because both of them have similar risk profiles in terms of exposure to the Chinese macroeconomy um you have that the Chinese reverse us like geopolitics so it's definitely a play where I don't want to uh you know go too crazy but um you order to control my My overall approach portfolio exposure to that so two questions okay one what's a small position so I I don't anticipate this getting extremely large for me either I'm talking about probably 40 shares to start you know just enough to have it on my radar and track a little bit more two more questions one are you saying that it would be less risky to put though that money towards JD and not towards more Boba shares uh that's a good question I'm not from a diversity standpoint you are diversifying slightly because you do have the different like kind of corporate structures and their different goals um but they have a lot of like a similar kind of macro risk so I I would still say it generally would improve risk because it's another company you own okay now last question if you did not own either of these and you had and you had 10 grand you had to throw down right now which one you're choosing still alib Baba yeah okay all right all right I'll buy 500 more shares of JD all right that's why I'm just kidding I'm not going to do that I'll be like 50 more um all right well guys finny's buying something it's a huge deal a oh man that's a congrats man so I'm so excited for you yeah I love it I bought 50 shares on Friday when you said you were considering it so all right all right guys we'll catch you on the next one let me know what you think down in the comments below
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