Investment Rating - The report assigns a "Buy" rating for Ibotta Inc with a 12-month price target of US$90, down from a previous target of US$129 [1]. Core Insights - The partnership with Instacart is expected to provide approximately 6% upside to FY25 revenue estimates, potentially catalyzing additional third-party partnerships [1]. - Despite a reduction in FY24 revenue and EBITDA estimates by 3% and 1% respectively, FY25 estimates remain unchanged [1]. - The report highlights that the third-party redemption business is still in its early stages, indicating potential for future growth [1]. Summary by Sections Investment Rating - 12-month rating: Buy [1] - Price target: US$90 (previously US$129) [1] Financial Estimates - FY24 revenue and EBITDA estimates trimmed by 3% and 1% respectively, while FY25 estimates remain unchanged [1]. - Price on August 14, 2024: US$47.83 [1]. Market Position and Growth Potential - Instacart holds an 18% market share in e-commerce grocery, with limited overlap with existing partners [1]. - The report notes a significant year-over-year growth in merchandise, which is expected to drive revenue per redemption [1]. - The second quarter saw a net addition of 1.3 million third-party redeemers, exceeding expectations [1]. Valuation - The price target reflects an 18x FY25 EBITDA multiple, reduced from a previous 27x due to increased volatility in results [4]. - The current enterprise value is estimated at US$2,126 million, with a market cap of US$2,206 million [6]. Performance Indicators - Total revenue for FY24 is projected at US$375 million, with a growth rate of 25% expected for FY25 [1]. - The report indicates a gross margin improvement, with expectations of reaching 36% by FY25 [6].

Global Research and Evidence Lab 14 August 2024 Equities Americas Healthcare Kevin Caliendo Analyst kevin.caliendo@ubs.com +1-212-713 3630 AJ Rice Analyst aj.rice@ubs.com. +1-212-713 4299 Christopher Mercado, CFA Associate Analyst christopher.mercado@ubs.com +1-212-713 1430 Andrea Alfonso Analyst andrea.alfonso@ubs.com +1-212-713 1342 Dylan Finley Associate Analyst dylan.finley@ubs.com +1-212-713-4880 US Healthcare A Look at Today's Stock Movers, News & Key Data What We Thought Was Interesting Today Today w ...

Global Research and Evidence Lab 14 August 2024 Best Buy Co. Inc. A Tough Lap or A Laptop Pop? Expecting an in-line 2Q; QTD comp and category trends will be key We think the most likely case is that BBY reports 2Q EPS inline to slightly better than the consensus EPS estimate of $1.17. That said, we think the market is expecting a total enterprise comp decline slightly below initial guidance for -3% (cons. also -3.0%, our model has a -3.5%). Our checks indicate sales trends improved a bit sequentially from 1 ...

Industry Overview - Auto insurance CPI increased by 18.6% year-over-year (y/y) and 0.9% sequentially in July 2024 [1][3] - Used car prices declined by 10.9% y/y in July 2024, accelerating from -10.1% in June and -9.3% in May [4] - Auto repair cost inflation moderated to +3.4% y/y in July from +6.7% in June and +9.5% in May [4] - Medical care services inflation remained elevated at +3.3% y/y in July, consistent with June and May levels [4] Digital Advertising Trends - Digital ad spend has been trending higher, with increases observed at ALL, PGR, State Farm, and USAA, while GEICO and ROOT saw declines on a month-over-month (m/m) basis [4][17] - GEICO's digital ad spend declined y/y in June but remains up y/y for Q2 2024 [4] - PGR is increasing ad spend to drive new business, particularly in the direct distribution personal auto insurance market where GEICO is its biggest competitor [4][17] Company Performance and Outlook - Personal auto insurance margins are expected to improve throughout 2024 due to rate increases and stable to moderating loss cost inflation trends [3] - ALL and KMPR are top picks in personal lines, with expectations of improving margins and upward estimate revisions [7] - PGR is expected to gain market share in the near term by loosening underwriting restrictions faster than competitors, though growth may slow in H2 2024 due to increased competitive pressures [7] Historical Data and Trends - The Manheim Used Vehicle Value Index shows used car prices down 4.8% y/y in July 2024, decelerating from -8.8% in June and -12.1% in May [10] - From 2008-2019, the Manheim Index grew at a compound annual growth rate (CAGR) of +2.5% [10] - Hospital services inflation was +6.1% y/y in July, down from +6.9% in June and +7.2% in May [4]

Investment Rating - The report does not explicitly state an investment rating for the industry or specific companies, but it highlights the underpenetrated B2B payments opportunities relevant to investors [1][3][11]. Core Insights - The B2B payments landscape is evolving with significant growth potential, particularly in accounts payable (AP) and accounts receivable (AR) automation, which presents opportunities for companies like Billtrust, Finexio, Mesh Payments, and ProfitSolv [1][3][11]. - The revenue models of the discussed companies vary, with some relying heavily on subscription fees while others are transitioning towards a mix of payments and software revenue [1][2][3][5]. - Virtual card usage is on the rise, with companies reporting strong growth without significant pressure on fees, indicating a favorable market environment for B2B payment solutions [1][2][3][5]. Company Summaries Billtrust - Billtrust is a leader in AR automation and B2B payments, processing over $1 trillion in invoices since its inception in 2001, with a 2022 total payment volume (TPV) exceeding $100 billion, reflecting a 35% year-over-year increase [1][2][11]. - The company operates a revenue model split approximately 50/50 between payments and software, with a focus on accelerating cash flow and improving customer satisfaction [2][11]. Finexio - Finexio specializes in end-to-end AP payment solutions, primarily serving middle-market to enterprise businesses, with a current payment volume run rate of approximately $3.5 billion [3][13]. - The company has experienced around 100% revenue growth in 2023 and has a virtual card penetration rate of about 12% of its volumes [3][13]. Mesh Payments - Mesh Payments offers an all-in-one travel and expense management platform, integrating corporate cards and expense management for global enterprises [4][15]. - The company has over 1,500 enterprise customers and has recently launched new products to enhance its service offerings [4][15]. ProfitSolv - ProfitSolv provides a suite of billing, payments, and software solutions for professional services firms, with approximately 94% of its revenue coming from subscriptions [5][17]. - The company has made significant acquisitions to expand its product offerings and currently serves over 100,000 professionals across various sectors [5][17].

Global Research and Evidence Lab 14 August 2024 LatAm Oil & Gas LightHouse: PBR, EC, YPF, RRRP, RECV, RAIZ, SMTO, TTEN, ORBIA, Fuel Dist. (3x), Agri. (2x), Global Oil Integrated and Junior E&P: PBR, EC, YPF, RRRP, RECV PBR: Government participates in Petrobras' strategic decisions. EC: We published a report on Ecopetrol's 2Q24 earnings result; see "Strong output now, but challenging horizons". YPF: CEO expects Vaca Muerta Sur (VMS) oil pipeline to be the first RIGI investment. RRRP: Jive Investments holds a ...

Investment Rating - The investment rating for TOTVS is Neutral, with a price target of R$33.50, implying a ~24x multiple to 2025E earnings [16]. Core Insights - The acquisition of Linx by TOTVS is seen as strategically positive, as it complements TOTVS' portfolio and could unlock new growth avenues, particularly in the TechFin vertical [4][7]. - Linx's current monetization is only 0.3% of its estimated R$350 billion GMV, indicating significant room for expansion [3]. - The integration of Linx's software solutions into TOTVS' offerings will require adaptation for small and medium-sized businesses (SMBs), which may necessitate further investments [3][4]. Summary by Sections TOTVS and Linx Acquisition - The CEO of TOTVS stated that acquiring Linx remains strategic, as Linx's capabilities complement TOTVS' offerings [1]. - Linx was acquired by Stone in 2020 for R$6.8 billion, and the integration has been ongoing since then [1][2]. Market Position and Client Base - Linx serves approximately 70,000 mid-large retailers with a GMV of R$300 billion, providing a new client base for TOTVS [1]. - Most of Linx's clients are larger enterprises, with only 11% being SMBs, which presents a challenge for scaling Linx's solutions to TOTVS' typical client base [3][4]. Financial Metrics and Growth Potential - The average monthly ticket for clients using Linx's ERP/POS software is R$160, supporting the potential for increased cross-selling opportunities [2]. - The report highlights that 50% of Linx's sub-acquiring clients have migrated to Stone, indicating successful integration efforts [2]. Valuation and Market Outlook - The valuation for Stone is based on a 2025E PE target multiple of 11x, reflecting the broader economic environment and regulatory changes impacting the Brazilian financial sector [8]. - The report suggests that TOTVS could benefit from future cross-selling of Business Performance solutions to Linx's customer base [4].

Global Research and Evidence Lab 14 August 2024 Cardinal Health Inc. Caliendo's Conference Call Commentary ● General Takeaways: Management provided additional color underlying the improved FY25 Pharma EBIT outlook and steady FY25 GMPD EBIT guidance. Within Pharma, guidance calls for y/y EBIT improvement of +1-3% with consistent generic market dynamics, a greater contribution from brand/specialty products, a modest y/y headwind from COVID vaccine, and cost optimization. On GMPD, CAH did not seem overly conce ...

Investment Rating - The report assigns a 12-month rating of "Sell" for Victoria's Secret & Co (VSCO) with a price target of US$13.00 [2][12][14] Core Viewpoints - Victoria's Secret & Co pre-announced Q2 2024 EPS guidance of $0.34-$0.39, exceeding previous expectations of $0.05-$0.20, while net sales are expected to decline by 1-2% year-over-year [2][4] - The appointment of Hillary Super as CEO is viewed positively, as she has a track record of turning around brands, which may enhance market sentiment [2][4] - Despite the positive short-term outlook, the report maintains a "Sell" rating due to ongoing structural issues and market share loss in North America [2][4] Summary by Sections Financial Performance - For FY22, Victoria's Secret generated approximately $6.5 billion in revenue [4] - The forecast for revenues shows a decline from $6,182 million in FY24 to $5,978 million in FY25 [2] - EBIT is projected to decrease from $327 million in FY24 to $255 million in FY25 [2] Valuation Metrics - The report indicates a forecast stock return of -31.8% with a market return assumption of 8.9% [3] - The P/E ratio is expected to rise from 10.8x in FY24 to 12.3x in FY25 [2] - The net debt to EBITDA ratio is projected to improve from 1.2x in FY25 to 0.9x in FY29 [2] Market Dynamics - The industry structure is rated as stable (3 on a scale of 1-5) over the next six months, indicating no significant changes expected [7] - The report highlights increased competition in the intimates market and a shift in consumer preferences towards off-price and mass merchants [2][4]

Investment Rating - The report does not explicitly state an investment rating for the railroad industry, but it provides various performance metrics and trends that can inform investment decisions. Core Insights - Railroad volumes increased by 3.6% year-over-year in Week 32, following a growth of 3.5% in Week 31 and 2.9% in Week 30, with BNSF and UP showing significant increases of 7.0% and 7.8% respectively [2][3][10] - A shift of international intermodal volumes to US West Coast ports due to potential strikes at Canadian rails has likely benefited BNSF and UP intermodal volumes in recent weeks [2][3] - All end markets, excluding coal, were above trend in Week 32, with agriculture traffic increasing by 18.1% year-over-year [3][10] Summary by Category Volume Growth - BNSF carloads increased by 7.0% year-over-year, UP volumes rose by 7.8%, while CSX shipments grew by 0.4% and NS carloads rose by 3.7% [2][3] - CN volumes decreased by 2.6% year-over-year, and CPKC volumes fell by 3.8% [2] Performance Metrics - In the western U.S., train speed fell by 4.7% year-over-year for BNSF, while UP's velocity increased by 0.9% [4] - In the eastern U.S., CSX's velocity improved by 7.3% year-over-year, and NS's velocity increased by 8.9% [4][11] Dwell Time - Dwell time improved by 6.2% year-over-year for BNSF and 2.9% for UP in the western U.S. [5] - In the eastern U.S., dwell time deteriorated by 3.9% for CSX and 6.6% for CN, while it improved by 10.8% for CPKC [5][11] Sector Performance - Intermodal shipments increased by 7.1% year-over-year, while coal traffic decreased by 9.8% [3][10] - Automotive shipments were up by 0.3% year-over-year, and shipments of industrial products rose by 1.8% [3][10]