Grab stock price: Are GRAB shares a bargain as Asian tech group eyes 2024 profit
By Jenny McCall
12:34, 28 September 2022
Singaporean multinational technology company Grab Holdings Limited (GRAB) announced on Tuesday that it expects revenue to slow but 2024 will be a key year for the group, when it expects to see some profitability.
The ride hailing company, which allows consumers to order transportation, food and deliveries via an app and competes with the likes of Uber (UBER), said it expects revenue growth of 45% to 55% in 2023. The SoftBank-backed group is forecasting that things will turn around by 2024.
So, are GRAB shares a bargain right now as it forecasts profit in 2024?
What is your sentiment on GRAB?
Grab Holdings Limited (GRAB) share price chart
GRAB a bargain...or a liability
GRAB's stock price is currently down 61% this year and in the last four weeks it has dropped by 10%. Could investors now be thinking that given its current low price, perhaps now is good time to buy before the stock goes up, as it heads towards profitability?
Grab (GRAB) had its first investor day on Tuesday and said that it is currently South-East Asia’s superapp and went from operating in one country in 2012 to eight countries in 2022 and is now available in over 480 cities.
“Our second quarter results showed that we can grow sustainably. We delivered strong revenue and GMV growth, while improving our unit economics and strengthening our category leadership position across key segments in the region,” Anthony Tan, Group Chief Executive Officer and Co-Founder of Grab (GRAB) said in a statement.
“We took action in the quarter to exit some lines of businesses that do not lead to long-term and sustainable growth. We will continue to optimize our cost structure in order to quicken our path to profitability.”
According to Bloomberg, analyst are bullish on Grab (GRAB) and have a consensus target price of $4.74 (£4.45) per share – indicating approximately 70% upside.
As of June 2022, analyst see Grab's revenues in 2025 at $4.55bn, which would equal a three year CAGR of approximately 30%, from 2022 to 2025.
But some analysts still see GRAB as a high-risk investment.
Uber (UBER) share price chart
If GRAB can capture a large part of the South-East Asian market, the stock could be valued at more than $100bn, but if this doesn’t happen, it could be hard to sustain the business.
Analysts at MarketBeat, have given the stock a ‘moderate buy’ rating, The company's average rating score is 2.60, and is based on 10 buy ratings, 4 hold ratings, and 1 sell rating.
“Consensus price target of $5.55, Grab (GRAB) has a forecasted upside of 104.2% from its current price of $2.72,” MarketBeat analysts said.
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