Market cap: 2.4 billion USD

Price: 5.30 USD

Brazil is one of the most exiting Emerging market in the world valuation wise. I reviewed companies like Sendas Distribuidora, Pics, and Brookfield corporation lookalikes such as Patria and Vinci.

All these companies are quality financial businesses with growth and deep discounts to global peers.

Today, I want to review Inter&Co, a another Brazilian Fintech, similar to the company reviewed two weeks ago, Pics NV.

As a prelude to this review, at emerging value, I focus on valuation first rather than narrative. I don’t hype companies that have XX% growth and extrapolate this growth infinitely in the future. I try to have a cautious view and take into consideration bearish arguments. I look for investments where the growth is the extra bonus that provides optionality.

Inter&Co is one of many that have these characteristics in Emerging Markets at the moment. While everyone looks at “1999 tech bubble 2.0 stocks”, the rest of the market in quality, growth and quality growth in Emerging markets is incredible. I don’t invest for anything else than shareholder yield and these yields only are bargains.

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History

Inter&Co was started in 1994, which is old for a fintech. This is because it was not a fintech but a financial institution that was originally part of a larger group. It started offering business loans, payroll credit.

In 2002 it left the larger group, and in 2008 it received a bank licence in Brazil.

In 2012 it formed Inter Group with the company Inter Seguros (insurance).

2015 was a milestone when Inter launched the first digital checking bank account in the country.

in 2016 the app was launched, and branded cards appeared.

in 2018 Banco Inter was IPOed in Brazil.

It raised money again in 2019 and 2020 and moved towards a super app.

in 2022, it moved to the Nasdaq and started offering services in the USA.

Along the way, there have been small tuck in acquisitions to acquire assets and product offerings.

This historical development was successful in terms of active clients additions.

In terms of financials, it is only since 2024 that Inter&Co reached the scale to enable full profitability.

Business overview

Similar to Pics, Inter&Co is a Brazilian fintech, an online bank.

It offers accounts for buyers and merchants, together with credit cards.

It also offers savings and investing products, and generates interest income from credit given to customers.

A home page could look like this (they are personalised for the clients), with Pix (P2P payment network in Brazil), Pagar (Pay), Cartoes (cards), some news feed with social features, an investing tab, a shopping tab.

Inter&Co intents to become a super app.

The app is personalised based on client activity, asset base and product activations.

Now that we know the basics about the business, let’s review the historical revenue development. Inter&Co shows strong growth quarter on quarter.

Net interest income is 77% of revenue, and fees are 23% of revenue. In the interest income side, that includes revenue from customer loans and revenue from investments held by the company.

For example in Q1, it held 46 billion in loans to customers and 27 billions in securities, as well as 4 + 4 billion in cash and funds due from financial institutions.

Inter&Co claims to focus on what they call sustainable lending: loans with lower interest rate than Card revolving credit and personal loans that can carry outrageous 100% and more interest rates in Brazil.

Like Pics, it is now turning more more on Secured loan markets: car loans, payroll and mortgages.

Beyond the positive self description of the business, we can look at the latest financials (Q1 2026) to see the composition of the loan portfolio:

• Mortgages are 24.5%

• Home equity is 10.3%

• Payroll+Personal loans : 25.6%

• Credit Card: 31.3%

• Small and Medium businesses: 8.3%

Together, 67% of the loan portfolio is secured.

The company is moving towards a super app strategy, with shopping, insurance, investing and many other functions. It has an integrated loyalty program.

Like Pics, the extra products carry frequency, offer monetisation opportunities, and the Inter&co customer base is still not fully penetrated (44 million clients).

None of these Fintech super apps are very differentiated. All the Brazilian players are trying to become superapps and I don’t see Inter&Co becoming a monopoly or a duopoly. Nevertheless, even if no winner takes all, Inter&Co and other fintech can take marketshare away from traditional banks and offline financial services.

Strategy

The main focus is to increase the client base, and to sell more products to the existing client base. For example it has only 9 out of 44 million clients who have credit products.

There remains ample potential to convert the other 35 million clients to credit products, as well as onboard new clients.

However, the Brazilian customer is reported to already be over leveraged, and this is going to be the difficult to fill that gap.

The plan to increase the credit penetration is supported by the following products:

The ROE is at 15.5%, but they plan to improve this ratio to 28% by 2029, notably by improving underwriting, increasing leverage, cost efficiency, growth, etc.

(Pics plans to get the ROE to 30% in comparison - this shows that similar business models can aim for similar profitability targets and to me validate their targets).

International expansion: Inter expanded to the US first because there was a need from their clients to have a USD global saving account and investing account. 5 million customers already use this account. Brazilian expats in the US also use it, and Inter got the naming rights for a Orlando MLS club (soccer) stadium and is actively expanding across the Miami region with sponsorship activities.

In the mid term this global account capacity can attract customers in neighbouring countries, as heard in a recent CEO interview.

Capital allocation: Inter is focusing on growing its loan portfolio, but still pays a fast growing but small annual dividend.

Management and shareholding

This is another family owned company. Here, the Menin family.

The controlling group controls 26% of economic ownership, and 78% of voting power. Softbank has 13.70% of economic ownership but only 4% voting power.

The other investors own 56% of the company but only 17% of voting power.

We have here a company completely controlled by Costellis International Limited, the (Controlling Group).

Before being led by Joao Vitor Menin, it was led by the Co-Founder Rubens Menin. The Menin family ownership led the large growth in revenue and net income over the past decade and it’s fair to say that they have been excellent in execution.

There is no recent insider buying.

Risk

Risk 1-credit losses

As with any credit institution, the risk is that non performing loans -NPLs- eat the net income and make the bank loss making.

And we saw in Q1 2026 the NPL increase a lot, especially 15 to 90 days. It was officially driven by private payroll growth and seasonality. Seasonality that we can confirm on the chart.

Cost of risk if nevertheless rising: “Cost of Risk -- CFO Santiago Stel said, “we are expecting something closer to six percent [for the year]” compared to previous guidance of “five percent–five point five percent.” The company adds that this increase of cost of risk is also caused by a voluntary push into some products.

Read more on risk here:

Risk 2-macro economy: here is a copy and past of my section on Pics reviewed two weeks ago: note that macro economy is not what I view as my specialty as it is widely unpredictable, according to the GOAT Warren Buffett.

-Macro economic view: I view the Brazilian interest rate as too high for the past two years, caused by a public deficit and to defend the currency. However, this is causing a slow down in the economy and a wave of stress for companies and customers. I am expecting some stress to continue until the central bank decides to cave in an reduce the central bank rate or SELIC rate.

The central bank has indeed started cutting rates in 2026, but the war on Iran is hurting this normalisation route. In any case, a worsening of default rate and economy would lead to rate cuts. Rate cuts in the USA would also impact.

Net interest margin is very high because interest rates are high in Brazil. I expect that rates could go down, or stay high depending on war on Iran and public spending. Brazil has a leftist president with Lula.

However, funding costs will also decrease when interest rates go down and net interest margins should decrease but not that much. Credit losses should also decrease when rates are lowered to 10 or 5%.

A lower interest rate should make savings accounts offered by Inter less interesting, which is a negative. I see in reviews of Inter and competitors, that Brazilians are very focused on earning high interest rates. In Europe here nobody cares about earning 2% and focus on the stock exchange more. On the other hand, a lower interest rate will send all Brazilian stocks higher due to a search for yield.

Quipus Capital discussed the macro economic impact of Fintech in Brazil of interest rate changes, in an interview I posted on the newsletter in February. I really like this clear summary from the interview, from someone who has studied Brazilian economics extensively. I recommend his publication.

I

Risk 3-Competition

What I wrote about Pics also applies here: this is a very competitive industry in Brazil.

Valuation

Let’s review the Brazilian Fintech peers and some regional banking peers: (June 20)

The whole sector appears undervalued. Nu Holdings is standing out as the clear leader in Brazil and Latam fintech. The price to book reflects the superior profitability and the price to earnings a premium.

In my opinion Inter&co and Pics Nv represent a much more interesting opportunity due to the large undervaluation.

Valuation for a growing online bank like this could be on P/E ratio, but there is a certain cyclicality in the business.

I like to look at price to book, and at 1.2x, it is reasonable.

looking at P/B is a way to normalise earnings, avoid over earnings, and look at a cycle neutral valuation.

That would be a 10% earnings yield.

Now with P/B of 1.2, the implied P/E could be 10 with a ROE of 12% for example. But our ROE is at 15% already!

I explained how a company with credit card loans like Capital one, although not perfect, is an interesting financial peer, because we see that in a stress scenario, ROE drops to 0% but for a very small time period before recovering.

I expect the ROE to touch the 29% goal and even go higher, but with temporary crisis in between when there are non performing loans.

Therefore, I view the long term conservative ROE for Pics (And Inter) conservatively in the 20% range and the corresponding valuation should be 20 times earnings and two times book value: This should be around 9$ for the price to book or 15$ for the price to earnings, since the price to earnings (Forwards) is at 6.5.

Looking at projected earnings growth, earnings per share are planned to grow 40% in 2026, then 30% in 2027. In 2025, it grew 45%.

I am not certain that the fast earnings growth we saw in the past five years can continue very far after this, due to the macro economic situation and the market saturation with fintechs, but this represent extra bonus upside.

Conclusion

I am not here to take some earnings slides that show 40% growth and be over enthusiastic and tracing a trendline into infinity.

I want to have a more nuanced view. After reviewing the company, I am only able to project that type of growth for 1-2 years due to market and credit saturation hitting soon, default risks, and a potential for a lower interest rate in Brazil.

However, I think that the risks are pretty priced in at low price to book, while the opportunities are completely ignored by the current price: future credit growth, customer expansion, international expansion and continued gain of marketshare versus legacy banks. A double in long term earnings totally possible, followed by lower growth.

At 6.5 times forward, it is a bargain.

Long Inter, Pics

Note: this is not financial advice, but my opinion on the company. Anyone should do their own due diligence to confirm a company thesis presented and form their independent opinion.

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• Pics: NASDAQ

• Price 10.82

• Market cap 1.42 Billion USD.

It has already halved in value since the IPO. The market has been brutal for Brazil, for Fintech, and for Brazil Fintech in the past months.

Now valued at 1.4 billion USD, PICS has 44 million active clients. Just looking at these two metrics, it seems like the deal of a lifetime. Is it really?

History

Pics was founded in 2012 in Vitoria, ES:

I also thought it’s Vitoria, España, but ES means Espirito Santo and it is here on the right above Rio:

Anderson Chamon, who is now also vice president of PicPay, was 31 years old at the time and had many annoyances when making payments on a daily basis. Each place had a different logic: some only accepted cash, others only credit and debit cards , and some even preferred checks (this was twelve years ago!).

The idea behind PicPay was simple: pay for everything with your cell phone just by scanning a code

Anderson (Chamon), que hoje é também vice-presidente do PicPay, tinha 31 anos na época e muitos incômodos na hora de fazer pagamentos no dia a dia. Em cada lugar, era uma lógica diferente: alguns só aceitavam dinheiro, outros só cartão de crédito e débito, e alguns preferiam até cheques (isso já faz doze anos!).

A ideia por trás do PicPay era simples: pagar tudo pelo celular só ao escanear um código

So, PicPay was created in Central Brazil by three entrepreneurs. It was a pioneer in P2P QR code payments, B2B money transfers.

And growth was slow. very slow. “Among the few people who already knew the app, Chamon knew everyone’s name.

Many of the users were customers of a café in Vitória, which was the first establishment in the city to accept PicPay as a form of payment: Café Bamboo.”

In 2017 it became part of J&F Group, after the first investments in 2015. The J&F Group is one of the largest business conglomerates in Brazil, present in many industries such as meatpacking, media, infrastructure, energy, etc.

In 2020 it got a payment institution licence that enabled it to launch credit cards and credit products.

Pix was launched on the same year. Pix is a Brazil based payment system, and it is not related to Picpay or Pics NV the company.

2021: Guiabolso acquisition: the company then ceased to be a standalone offer and the products were integrated into PicPay.

2022: PicPay became a financial institution, giving it more option to offer loans.

2023: BX blue acquisition: another fintech specialised in payroll loans, and integration of Banco Original retail customer base, as it was facing more and more non performing loans, as a move to streamline operations and cut costs.

2025: Kovr acquisition: a digital insurance company.

2026: IPO on the Nasdaq, raising 490 million $.

The revenue and income development has been a large success:

Business overview

So after avoiding Nubank, Inter&Co for years, am I excited or not? We will see in my review below:

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I did a summary of the emerging market online companies, mostly in E-commerce and Fintech.

This did not include Tencent or Baidu in China as I mostly focused on e-commerce and fintech. I included MakeMyTrip in India because we don’t have any other Indian Tech ADR.

In this list I wanted to look at global commerce companies with another lens than the classic price to earnings ratio, which I used in the past to find good bets in the sector. (I point you to my analysis and portfolio reviews).

This list was tailored by me, pre-populated by claude AI, corrected manually for some datapoints and cleaned, before I asked claude AI to generate simple charts instead of doing them myself in sheets (same result but better looks).

I believe that we have to work with AI now and not pretend we do not use it and get along with the times.

If you liked this article please share it. Please note that not all data in the charts will be exact to the last decimal, but good enough to see the big picture. I am not S&P Global. Thank you, and let’s go.

Also the article was prepared before delivery hero is entered into a bidding war and is rising another 10% on Monday.

1-overview of the group of companies and Market cap ranking.

We can clearly see that Jumia in Africa is the smallest while Chinese giants Alibaba and PDD dominate the market cap ranking.

Two Brazilian Fintech, PicPay and Inter&Co, are among the smallest market capitalisations in the ranking. This could highlight an opportunity.

Another point I notice is that the vast majority of these companies are under the 100 billion USD market capitalisation figure, which is quite stunning giving the size of the opportunity, and many are under 50 billions.

2-Companies per revenue

In terms of revenue we can see again the Chinese e-commerce giants being heads and shoulders above the rest.

JD.com is first, but revenue is not the best way to compare JD, Alibaba and PDD. JD operates on a first party business model and sells the merchandise itself, while the others let third party merchants and only take a fee on the sale. GMV would be the best comparative between the three.

We have a group of companies under 10 billion in revenue, and these are companies early in the development cycle.

3-Companies per active users:

(Ecommerce branch for Sea limited).

Again, China is number one. This is truly another scale.

Sea limited (E-commerce branch) comes as second behind China in South East Asia.

Latin American countries are behind, and last are Eastern Europe and Africa.

4-Total Addressable market

Next is the population total addressable and reached:

Note that here for PDD and Alibaba, I put the almost the whole world at 6 Billion people, due to them being offensive with Temu, Aliexpress, and for Alibaba local acquisitions in Turkyie and South East Asia.

We see the scale of China. What shows up is that JD and Sea limited are much closer to their total adressable markets than the others. It’s difficult to see Coupang, but it’s well penetrated too.

This leads us to our next chart: the percentage penetrated: note that kids are not ordering on e-commerce platforms with their own accounts, so 70-80% of the population is probably the ceiling.

Sea limited is at a high percent, but I did not include Brazil here in the definition of TAM. Nevertheless it is very well penetrated in terms of TAM.

Mercado Libre is very under penetrated, which kind of surprised me as it has a large user base and market capitalisation, but Latin America has over 700 million people.

Delivery Hero is small in terms of penetration.

Makemytrip too, and the winner is Jumia, which has penetrated a tiny tiny part of the African population.

Pure fintech like Nu, Picspay and Inter&Co may never reach 80% of the population as people don’t use fintech as much as they use dominant e-commerce websites. They stuck to one or a few online banks.

5-Price to TAM

When looking at the price to TAM or the total addressable market, it tells us how much we pay for the total addressable market. This is more of a ratio to compare companies than a number that can be exploited.

Coupang is the most expensive because Korea and Taiwan are quite small countries, and the value of the market cap is quite high related to this population of 75 millions.

We find that Mercado Libre or Kaspi and Allegro are not cheap on these metrics. The cheapest are the un penetrated African and Indian consumer businesses Jumia and MakeMyTrip.

The brazilian fintech are also cheap here, PicPay and Inter&Co. But pure fintech is not e-commerce and we cannot expect all the companies to reach a 80% penetration. In e-commerce it is more common to have several memberships versus in fintech, but it could happen.

6-Price per active user

The market cap per active user is showing the cheapest stocks per active users.

We can see that Picpay is the cheapest on price per active user, and other Brazil Fintech Inter&Co is also low. This is reflected in the lower monetization of users when a product or service is of lower usage and average revenue per user is lower.

On the other hand, Mercado Libre (price has fallen a bit since then) and Coupang are the most expensive per user. This means that the market is willing to pay a higher price for users who are very active and bringing a lot of revenue.

This leads to our next chart:

7-Revenue per user

Coupang has a lot of revenue per user due to its dominance in South Korea and first party commerce sales too.

Mercado Libre and Kaspi are doing very well here.

Nu is impressive for a fintech.

We have then a group of companies, Jumia, Grab, Inter, PDD, with different business model and low revenue per user.

Makemytrip, at 14$ seems very low, and it’s either an error, or something due to some customers just using it for bus and train tickets, or cheap hotels in a country with a very low GDP per capita.

8-Valuation for price to sales

First party companies like JD, Coupang and Delivery hero are the cheapest.

On the other hand, less proven business models like Grab and Jumia and MakeMyTrip carry a growth potential premium.

Claude reviewed my internal comments and left the following ones on valuation

9-Combining price to sales and low penetration

Here, ideally you want the company at the bottom left corner: low price to sales and low population penetration. But it’s not easy as price to sales could mean a first party retail model.

Delivery hero is a food delivery company and now quick commerce also business that may not be able to penetrate the whole population. Delivery hero is subject to take over rumours from Uber and others at the moment. It was even cheaper when I built my position (see my article from last summer) and last follow up with better understanding of the business.

On the other side, Sea limited is very penetrated in South East Asia, but has buyers in Brazil that are impacting the penetration on the chart.

10-Conclusions and next steps for research.

What companies that I don’t own interest me the most?

What do I want to see in each company ranked attractively to make it a compelling investment?

Plus, I also charted the companies by a subjective “Market dominance ratio” from 1 to 5, versus price to sales. This next part is for premium subscribers only, but I hope that the above free research can already give some hints and tracks to explore for every reader.

This is in the premium section of the article. You will also be able to access analysis of some companies in the list such as Jumia and Allegro.

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Some similar tech and platform companies that were not profitable and supposed to never make money started making profits. Such as Grab and Uber.

I remember when there were debates about Uber path to profitability, and nobody really knew if they were going to be profitable ever.

But they did, and Grab too.

Talking about Uber, they just added to their position in Delivery Hero to become a long term shareholder of Delivery hero a few days ago:

Delivery hero is a leading delivery company, traded in Germany but whose main markets are in Asia. It leads in some markets while is behind in other smaller markets.

Delivery hero is also turning profitable.

I think that all these tech platforms can end up with a decent profitability: more than 10% adjusted net margins.

Therefore, it makes sense that mature tech companies end up with valuations over 1 times sales or even 2 times sales.

This corresponds to 10 times long term earnings power or 20 times earnings (Assuming 10% net margin, no huge debt costs).

Delivery hero? 0.35 times sales.

With the EV, adding the debt: 0.6 times sales.

Is this the best delivery business in the world? No

Will they figure things out? I believe so.

So it’s all about patience. Platform companies eventually figure profitability out.

Sometimes there are price wars, promotions, investment years, but 5, 10 years down the line, they always mature.

In this review, I wanted to see how safe it is to add to my position, and how big is the opportunity, after Delivery Hero posted the 2025 annual results and announced perspectives for 2026.

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We have seen how Chinese companies in various industries took the world by storm.

First we had electric cars with BYD. We had retail with Miniso. We had the Deepseek moment where AI models made in China competed effectively with US models. This is also true with Baidu and Alibaba’s models. We have seen Chinese tech companies like Temu and Shein take over marketshare globally.

There is no doubt that China will dominate the world’s economy more and more.

That isn’t to say that the west does not keep some dominance in key sectors, such as AI with Alphabet or ASML, or fashion and culture, and healthcare with decades of experience. But the world is now multipolar.

Therefore I have increased my interests in China. I don’t want to say that I am an expert in China, not at all, but I do have some experience in deep value investing.

This is how you avoid micro analysing quarters and products, generating noise that blurs the big picture.

A few years ago Alibaba was winning everything, then it was JD, then it was PDD, now PDD is retreating a bit, and every time, Chinese experts told us to buy the hot company of the day and ignore the others.

The results of these calls were not great to say the least, because the hot company was already well valued by the market, or because the hot company was just about to discover the biggest force of capitalism: competition and imitation.

So take a seat and enjoy the 8 following picks:

But first, word from my sponsor, Rebound Capital:

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1.Haier Smart Home (Trading in Germany)

Shares of equipment maker Haier dropped in Hong Kong and the company now trades at 9 times earnings.

This is a growing company with a long term track record in appliances, and a growing focus on HVAC.

The German listing on the XETRA trades at a 18% discount (8 times earnings) and offers a 8% dividend yield.

The last results are not great but ok.

5% basic EPS growth for 2025 is not that great, but Haier has been a long term compounder with M&A, organic growth and local demand and should continue to do so, on top of a good dividend.

2-Miniso Group

Ah, the little retail company that is growing like weeds and building a scale moat across the world. Its ability to collaborate with IP owners like Disney or Kuromi and roll out items worldwide is unmatched. It has strong China exposure at 54% of sales in Q4.

Let’s review the last earnings:

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I always stayed away from Nubank and Inter & Co, due to high interest rates and a consumer credit under more and more pressure in Brazil. I could not get comfortable with that.

I could get comfortable with a much more defensive business model, at cheaper valuations:

Sendas distribuidora is a retailer in Brazil. It is only available on the OTC market and in the Brazilian stock exchange.

Market cap: 13 billion BRL.

This company represents a very interesting set up to invest in a forever defensive asset at low valuations.

But first, a clarification. The company name is Sendas Distribuidora, while the business is called Assai Atacadista. This is a bit confusing. For clarification, I will use the name “Sendas” everywhere in the article.

History

The company was started with one store in Sao Paulo as a wholesaler for retailers in 1974. The name Assai comes from the Japanese Asahi · Rising sun.

Fast forward to 2007, where the company has only 15 stores. GPA took control of 60% of Sendas. GPA was itself controlled by the French Casino group, a company that was a major french retailer and is now insolvent.

GPA allowed for growth and entry into the consumer retail segment.

• 2008 - 28 stores

• 2010 - 57 stores

• 2011 -58 stores and fully owned by GPA

• 2017 - 127 stores and launch of the Passai card.

• 2017 - 166 stores

• 2021 - 212 stores - Spin off from GPA, and the purchase of Extra Hiper stores is announced, which will be converted into Assaí, through a transaction worth R$4.2 billion.

• 2022 - 263 stores

• 2023 - 288 stores

• 2025 - 312 stores, 10 new during the year.

• 2026 - Sale of financial services firm FIC

We can see that there was an acceleration in number of stores post 2021 followed by a slowdown post 2023. This is not an accident.

This is because of high debt and an increase in the Brazilian central bank interest rate and the end of cheap credit.

Here we are in 2026, with 313 stores and a relatively high leverage ratio.

The company managed fast revenue growth since 2019.

Business overview

Sendas owns and exploits 313 stores in Brazil.

It is “a Brazilian wholesale company that serves small and medium-sized businesses and consumers looking for savings, product variety, and good customer service.”

The stores look like the first picture of my article above. Sendas offers low prices by focusing on the large volume model.

They mostly don’t use distributors but deal directly with the food and products producers. The pallets with high ceiling model allows for cheaper storage and low in store labor costs.

58% of sales are B2C and 42% B2B (Food service and resellers). B2B sellers mean that they also move inventory faster compared to a traditional supermarket.

All these points together, the classic cash and carry model, allows for Sendas to offer cheaper prices due to cheaper operating costs.

Most of the stores are in the Sao Paulo and southeast area, with a population of over 50 million people. This is closely matching the GDP and population map of Brazil, with maybe some absence in the Southern and western part of Brazil. There remains room for a lot of expansion.

High leverage: the curse and the opportunity

..

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Another difficult week in the markets and in geopolitics. Meanwhile, we are still shareholders of businesses.

As a reminder, JD.com is one of the big e-commerce companies in China, with 700 million active customers and a market capitalisation of less than 40 billion USD!

But first, a word from our sponsor: Rebound Capital.

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E-commerce, in Africa, this is the basis of Jumia.

But it’s not as easy as it sounds like. Nothing is easy in Africa.

History

Jumia was not created within the continent. It domiciled in Germany.

It was founded in 2012 as a Ebay and Amazon clone and backed up by Rocket Internet, a company whose purpose was to copy American internet portals into Emerging markets. It was also backed up by Pernod Ricard Deutschland. Don’t ask me why. I find that funny. They still own shares as of the latest annual report!

The company was co-founded by two French former McKinsey consultants, Sacha Poignonnec and Jeremy Hodara, who worked closely with the German team at Rocket Internet. While they collaborated with African co-founders (Tunde Kehinde and Raphael Afaedor) to launch operations in Lagos, the corporate structure remained European.

For this reason, Jumia was built with outside capital, with offices in Germany, Portugal and Dubai, and has no real Africanity.

This is well hidden from their website, the website has no history section at all.

It grew with capital until the IPO.

In 2020, Rocket internet exited.

What happened with Jumia is a tale of investing in emerging markets, especially in Africa.

It launched a business that was ambitious in a region that was not ready for it, in terms of market size and affordability. Not to mention the difficulties of logistics and road traffic in Africa.

Since the IPO, another effect took place, the rise of the US dollar and the fall of emerging market currencies caused by the US dollar bubble of 2020-2025.

This caused real sales to stagnate or even go down, worsened by the COVID crisis that damaged the continent’s economy.

The IPO was at the right timing to exit, or at the wrong timing to enter.

Because of these macro factors, Jumia saw no revenue growth since 2020. This is really terrible.

From 2022, we can see that losses have reduced, notably from exiting loss making segments. I see a good proof of recent good execution and discipline. I stayed away from Jumia all this time, as I expressed my bearish stance a few times.

Where is Jumia today? is this going to be the Amazon of Africa? Is it an opportunity now, or down the line? This is what I am trying to uncover in this article.

This article is for premium members only.

We uncover Business overview, strategy, management and shareholding, market and risks, a quick valuation and my conclusion.

Subscribing gives you access to all the past write ups, the emerging market names as well as non US/ non Swedish serial acquirer universe.

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While markets, and arguably the world, are in turmoil due to the war on Iran and Lebanon, there are opportunities in long term compounders and quality companies in various areas of the world.

I don’t know what is going to happen with Iran. I just know that good companies will make more profits in 3 and 5 years.

Long term growth and quality is undervalued by the market. The ability to grow 10-15% or more each year while returning capital via dividends does not make for 6 months 100% returns, but for a double in some 5-7 years depending on valuation, then again, and again. If you buy these at low valuations, the maths are even better.

Actually, I believe that quality growth companies are cheaper than deep value names for the first time since 2007, and that it is now a great opportunity to build into these positions. I am not the only one thinking this, many quality oriented writers call these opportunities as historic, and I have moved my portfolio more towards quality and compounders in early 2026 and 2025.

In this article we will focus on Latin America, based around my current portfolio, and why I am cautious on popular Fintech from Latin America.

7-Ecopetrol (NYSE)

The Colombian oil and infrastructure company has been on a tear year to date, pushed by the rise in oil prices.

I believe that it is now close to fairly valued, with a dividend in the 7% range, but with potential for more. The earnings estimates have not been updated yet with higher oil prices, and it’s unclear what will the prices do over the course of 2026. It remains a solid company to get exposure to oil prices, just like Petrobras.

6-Auna SA (NYSE)

The Latin American hospital operator is struggling with the Mexico operation.

Hospitals are capital heavy and not my favorite businesses. However Auna trades at 6 times estimated next year earnings, but with high leverage (3.1 times Ebitda).

As the company deleveraging cycle concludes, it should produce a lot of FCF relative to market cap. However, I can see that the leverage does not go down in 2025, and the company did not generate real earnings, with large financial costs.

The company posts an adjusted net income, but it does not seem accurate to me with all the extraordinary adjustments and no reduction in leverage.

I would recommend much more DD before going into this. I have not analysed this company, and it is currently a pass for me, and I do not know if the estimates are outdated or current in line of the latests issues in Mexico. Check Ian’s insider corner for coverage on this company and generally of Latin America

5-Coca Cola Femsa (NYSE)

It does not get more quality and safe than Coca Cola. This one is a bottler for Mexico, Central America and Brazil at 13 times forward earnings.

With EPS growth in the 10 to 20% range in the next few years, pushed by good execution and strength in currencies, this is a sleeper compounder.

In the same business but more Chile and Argentina focused, we have Embotelladora Andina S.A at 13 times forward earnings, but with lower growth growing forward.

I do prefer the Coca Cola bottlers to the alcoholic beverage companies who are struggling with higher costs and pricing already elevated. They have outperformed since 2020, and are more expensive than the Coca Cola bottlers,

4-Mercado Libre.

Mercado Libre was quite overpriced in recent times but as the company stock price was nearly halved from the highs, it now trades at 30 times forward earnings but more interestingly 2.4 times sales.

This is cheap for a leader in the region that drove these kind of numbers.

At 87 Billion dollars, it isn’t small market capitalisation anymore and I prefer some other companies, but it is fair valued to undervalued if they can do these numbers for a set of years.

They reported lower net income and margins due to heavy investments in growth, which spooked the market. I would expect a good company to invest heavily for the future, especially in emerging markets.

I did not conduct a deep dive on Meli.

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Market: Poland

Price: 28.6 PLN

Market cap: 8 Billions USD

History

The Allegro group has a long commerce history in Poland. It was started in 1999, which is a very long time ago for an e-commerce website. Since then it followed a classical product expansion in e-commerce.

The corporate structure is a bit unusual, since in 2017 it was acquired by private equity firms Cinven and Permira, and later was IPO’ed on the Warsaw stock exchange in 2020. Cinven and Permira retain a stake.

It went public in 2020, at a lofty valuation. What happened after is a classic tale. Hype, then despair, as a very overvalued stock went public. Since then, investors have marked Allegro down according to earnings and perspectives. There is no more hype. This is where we enter. But back to Allegro History, with a big blunder.

The failed international expansion:

In 2022 it acquired the loss making e-commerce Mall Group, with operations in central Europe. The price paid was 4 billion PLN or 880 million Euros, only for Allegro to take a huge write down a few months later - 2,3 billion PLN. At the time, the idea was to expand TAM, Total addressable market, from 38 million to about 70 million people. It made sense.

They paid 1.0 times LTM GMV and ~7.2 times LTM Gross Profit.

Mall group was break even, and operating under a first party model. I did not like the acquisition at the time due to a high price. It was a disaster.

In 2023 and 2024, Mall losses increased. So much that Allegro is now actively closing Mall group websites and opening Allegro websites in these countries.

The following excerpt explains what happens:

In 2025 Allegro sold the Slovenian and Croatian business. Now, it is closing down the Mall first party businesses and restarting Allegro.cz /.hu / .sk from scratch.

Despite this, the Polish business carries the group forward with EBITDA and net earnings growth:

Here is a summary of the history from the investors presentation.

Business overview

1.Poland

Allegro is a mostly third party or 3p marketplace e-commerce website in Poland that has an estimated 38.8% to 50% share of the total market in Poland.

It is the number one shopping destination, and has over 80 million products with selection being a key feature for buyers.

It has added 600,000 active buyers in Q3, exceeding 15.2 million in November 2025.

The Polish population is estimated to be around 38-40 million people including foreigners, and this shows the scale within the country.

It manages to get deliveries using mostly third party delivery companies within 1 to 2 days. It does not seem very fast, but it seems fast enough for Polish customers.

• First Party business: Less than one percent of GMV

• Third Party business: 99% of GMV. For this part of the business, sellers can offer direct shipping but Allegro has a fulfilment model similar to Amazon FBA: One Fulfilment. It operates warehouses in Poland.

91% of items are delivered within two days.

The marketplace has a “loyalty program” similar to prime, called Smart.

Smart has 7 million members, and it is like Amazon prime. It has third party benefits (Cinemas, Busses, 3 months Disney+, etc).

As you can see anyway, the Allegro business is similar to Amazon except that the logistic is mostly handled by third parties. A high population density and small country size makes that the delivery time is still acceptable even with third parties.

In terms of recent results, GMV is up 10% in Q3 2025 and EBITDA 24%, notably pushed by advertising at 32% year on year growth.

The total GMV in 2024 was 15 billion USD out of a potential of 350 billion USD of retail sales in the region, leaving room for growth.

Competition:

In terms of Competition, Amazon launched in Poland in 2021 only.

Amazon ramped up investments with 8 Billion PLN capex in 2024, and has 11 fullfilment centres. It has 6.45 million users and decreasing, maybe from Temu’s pressure.

Temu has now 20 million users, more than Allegro, but you know how we use Temu in Europe (or Aliexpress), a few gadgets here and there due to distance and quality issues.

It seems to me that Allegro already has convenience and items, but could be beaten on delivery speed if Amazon ramps up the logistics. But Allegro understands this and is working on Logistics with it’s own delivery lockers, along with Partners.

2.International business: The mess

We already covered the blunder that is the international expansion and the related losses.

Nevertheless, let’s explore the prospects for this segment.

Allegro bought Mall North in 2022, only to discontinue it partially (the first party sales at least) in 2025. The active buyers have decreased for the Mall segment and are being replaced by Allegro Marketplace. Mall North will close in Q2 2026.

We can clearly see in the chart above that Allegro is replacing Mall North legacy operations with international marketplaces.

International marketplaces are third party items fueled. They cost less to operate than first party business Mall websites, and they also allow for these Central European buyers to buy items from Allegro Poland sellers, creating a virtuous circle.

The transformation: integrate for synergies, replace Mall and CZC websites to include them as merchants on Allegro.

Adjusted EBITDA for international operations is PLN -356.1m in 9M 2025, a 12% lower loss than the previous year.

I think that with 4.2 million active users on the new “Allegro” marketplaces, for a region of 15 million people, that new new marketplaces have reached sufficient scale to operate with good profit within two years.

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The region is set to create huge value for investors with GDP growth amongst the highest in the world, coming from very low starting points.

6-Jardine Matheson

Jardine Matheson is a global holding company with assets in Chinese real estate, Indonesian Automotive, Energy, Finance, Retail, Hotels and many semi defensive businesses. The stock went up a lot since my entry last year after a change of CEO, buybacks, and momentum.

Everyone was saying that the stock is dead but this is deep value. Momentum now pushes the stock. It is a long term holding company in Asia with a Berkshire Hathaway type business goals, but not everyone is Berkshire, it has less quality in businesses.

The capital allocation is rational, with many buybacks at the subsidiaries level (it owns listed subsidiaries) and at the holding level.

At 13.8 times forward earnings, I rank this at a hold at best.

5-Jardine Cycle and Carriage

The Indonesian - mostly automotive subsidiary of Jardine Matheson trades at 10.6 forward PE. While more cyclical in a way, it is exposed to only the Indonesian and Vietnamese business.

I think it is more attractive in the long term as it is exposed to a pure Indonesian and Vietnamese growing economies, not having the slow growth Real estate exposure of the parent.

I would not be surprised if it is taken private at a premium by Jardine Matheson.

4-Grab Holdings

The Uber like company of South East Asia has a market capitalisation of 17 billion USD.

It trades at a forward EV/Sales of 3.3 and P/E of 49. Not a bargain.

Grab posted 19% revenue growth and 21% GMV growth in Q4.

One concern is that Shopee is implementing Shopee food and becomes the leading super App of the region.

With a target of 2028 “Adjusted Ebitda” of 1.5 Billion on a 17 Billion market capitalisation, Grab is a decent value proposition for the long term.

That said, I am not an expert on the name, and if you are interested look for coverage by Gabgrowth.

3-Thai Beverage

This is a company that I sold in order to be more growth oriented in my portfolio, but it remains defensive and cheap.

Thai Beverage is a drinks and also food conglomerate whose majority of profit comes from hard liquor, with beer, non alcoholic and also food businesses. It is expanding to the whole of South East Asia.

At 10.6 forward PE it is cheap for a beverage business with defensive characteristics, especially that in Q1 26, it showed good growth in Spirits and beer, something rare in the world, but affected by other beverages decrease.

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This is not a sponsored article, no funds were exchanged. Rather I view it as a win-win. Quipus Capital can gain subscribers and we gain knowledge…

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7-Allegro (Poland)

The Polish Ecommerce company trades at 14 times future earnings.

It is a market leader, beating Amazon and Shopee in Poland, and now developing the fintech business from a low base of clients. Allegro also has currently lo…

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I have looked at many popular emerging market names as I reshuffle my portfolio. I am not very convinced. The fact is the very popular great companies are already priced in as great companies. Let’s look at some different companies.. starting with Miniso.

History

The original intention of creating MINISO is to establish a lifestyle. It does not deliberately emphasize so-called popular fashion or individuality, but the products are genuine and unique; it also does not believe that popular brands should raise their prices

Miniso started in China as entrepreneur Ye Guofu, inspired by Japan’s affordable lifestyle stores, founded the brand to offer well-designed, inexpensive goods in 2013, and quickly expanded domestically before launching internationally in 2015.

Miniso Initially adopted a Japanese aesthetic. The brand grew rapidly through a franchise model, becoming a global retail phenomenon by offering well designed, affordable products, though facing scrutiny over its branding and origins.

Key dates:

• Established in Guangzhou, China, in 2013, starting with a focus on design and affordability.

• 2015: First Overseas Store: Opened in Singapore.

• 2020: IPO : 4200 stores

• In December 2020, MINISO launched a retail brand called TOP TOY to focus more on toys.

• 2022: the company started to remove Japanese elements from its branding amid huge controversy that it is copying Japan and pretending to be Japanese while being a Chinese company.

• 2024: Acquisition of a stake in Yonghui supermarkets.

Business overview

• 2 Brands: Miniso, Top Toys

• 1 Affiliate: Yonghui supermarkets

1-Miniso brand:

Emerging value is a reader supported publication. In this article I don’t focus on numbers, but on the essence of Miniso and what makes it different and unique. Thanks for your support!

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Let’s summarise: A payment company that facilitates payments in emerging markets for global merchants. Trading at a forward P/E of 17 and growing revenue 40% Yoy and EPS 30% Yoy.

There are many posts or write ups that are very bullish, but this is just looking at current numbers and earnings presentations.

Instead of just taking the copy slides from the powerpoint deck and be super bullish, I decided with by friend Bright to get an industry insider perspective on Dlocal and challenge the consensus bullish view and look at the real perspectives of the business.

First, we covered the bullish outlook:

Payments Strategy and Investing

Dlocal: growing fast but merchant dependent

Dlocal is a payment company from Uruguay that allows merchants to receive payments in emerging markets…

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7 months ago · 6 likes · Emerging Value and Bright

Then, we covered the bearish arguments.

Payments Strategy and Investing

Dlocal - The bearish thesis

After last week past article, which covered the bullish points and introduction on Dlocal, we have covered the bearish thesis…

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7 months ago · 5 likes · 2 comments · Emerging Value

However, after this discussion, I came to the conclusion that this was not going to be enough to understand Dlocal enough.

If I was an regular writer, I would put in place an excel model, drag a formula to the right, and include some quotes from the CEO and talk about Total addressable market, add a 20 multiple and the research would be done.

But some key points need to be analysed with focused research:

So I decided to write another premium article where I focus on mapping the list of merchants already using Dlocal, the potential for more merchants, the real market size (and not the one from the investor presentations) and some key points around geographical expansion.

This is not going to be perfect, because we are operating under incomplete information, but this is a honest attempt at really understanding an opportunity.

Introduction

Dlocal is an emerging market payment company. It helps global merchants with receiving payments from customers that are in emerging markets.

This is a very fast growing company at 17 times forward earnings.

The key problem is simple; many times, when emerging markets consumers want to pay US merchants, they encounter problems:

• Their card gets declined

• Their card network is not enabled for international payments

• Their subscription rebill gets declined

• They don’t have a credit card

• Their mobile wallet is not offered.

All of this, makes lost sales for the merchant as the buyer simply is not able to buy.

Enter Dlocal:

You sign a contract with Dlocal, you choose if you want local currency payments or if you want the payments to your US (or Europe) bank account in your currecncy.

Dlocal takes care of the rest. They connect with local banks to make sure that you receive the payments with the highest success rate and that you offer all the mobile wallets (Alternative payment methods or APMs). They receive the funds and send them to you, all for a fee. You do not have lost sales due to payment problems.

Dlocal was started from Uruguay when the founder could not pay online at a US merchant. He built a solution to accept a local Brazilian payment on one side, and send an international payment to the merchant on the other side, while collecting a fee in the process. Dlocal was born.

Below is my review:

1-Check the customer list and see the potential for large wins

2-Name the large merchants left to win

3-Estimate their Latin American potential revenue from this client base

4-Compare Dlocal versus Adyen

5-Growth outside of Latin America

6-Conclusion on long term growth outlook and if I kept, added or sold Dlocal.

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Diego Milano is the manager of the Quercus Fund. It is a fund based on global equities and deep value.

The objective is simple, but not easy: to buy securities at extremely low prices in relation to their intrinsic worth. In order to find and hold them, the Fund employs a unique deep-value, long-term, and unconstrained global approach.

We met in Vienna fo…

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1-PDD (Chinese stock trading in the USA)

Oh well, the first one is not listed in Hong Kong, but I thought of including it.

I covered JD.com, the Chinese e-commerce company that is owning the delivery and products end to end, but I am also interested by PDD.

I think that E-commerce is an oligopoly with good economic characteristics.

However, in China, JD and PDD have been outperforming Alibaba in terms of drive and management, because Alibaba has been managed more like a corporate company, while JD and PDD are managed my owners and more for growth.

PDD has been able to revolutionise e-commerce in China and a bit worldwide too. I live in Europe and was recently in Latin America, and Temu is part of the vocabulary. It has achieved top of mind space in the consumer minds. This is priceless, just like ChatGPT has done. This is a sort of moat because it will bring millions of customers just for that fact.

I am no expert on PDD, but at 9.5 times forward earnings, it is a bargain for that growth.

Analysts know PDD more than me and expect good EPS growth in 2026 and 2027.

Watchist

2-CITIC Limited (267.HK)

Citic is a stable industrial conglomerate trading at 4-5 times earnings. However it only pays a 4.4% dividend and without buybacks, I want to see where the earnings are going. They are not being used for earnings growth.

To Study. Maybe the revenue growth that we see on the chart hides a potential for future profit growth

3.Swire Pacific - (19.HK)

This is a conglomerate present in real estate, Coca Cola bottling and aviation with Cathay Pacific.

It trades at 8.3 forward earnings, 0.3 price to book.

What is nice about Swire Pacific is that the company focuses on shareholder value creation with corporate actions, a high dividend and share buybacks.

For example it acquired a Coca Cola Bottler in 2024.

To Study.

4.TCL Electronics (1070.HK)

This is a fast growing electronics company that mostly produces televisions and sells worldwide

.

At 12 times earnings and EPS growth expected in the 20%, that seems cheap.

Profit is up 62% for the half year 2025.

The company is now a leader in the TV business. It also grows 100% + in the photovoltaic business.

Personally, I don’t really want to try to understand these type of businesses, therefore I pass, but if you are interested or know the industry, it could be good to dig further.

5.JD health - (6618.HK)

A fast growing subsidiary of listed JD (That I own), at 27 times forward earnings, it is not cheap, but at 1.6 times sales, maybe the profitability is still not optimal and therefore the company could be undervalued based on future earnings.

The business operates a closed-loop model: “Consultation + Examination + Diagnosis + Pharmaceutical”

• Online retail pharmacy

• Healthcare services, online to offline

Because a lot of the sales are of retail pharmacy, growing operating margins would be a bit difficult.

Interesting, but I prefer integrated e-commerce models as health only is less attractive. JD.com

6.Alibaba health - (241.HK)

Alibaba Health trades at similar 29 times forward earnings and 1.9 times sales.

It’s revenue is half that of JD Health.

The business model is similar:

We have the platform business and the direct sales business:

Interesting, and this company has better reporting with IR presentations as JD health, to understand it better. To study but it is not cheap. Second order.

I thought of making this article fully public, but I want to keep the following net-net with buybacks private because it could interest me in the future.

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Honesty before anything.

Therefore, this week, there will be no “best buys”, because I spent the previous week searching the Hong Kong market for new value ideas instead of reviewing my holdings, and I have more to check.

First I looked at Jam invest posts. Jam invest is a writer who covers Hong Kong a lot.

But then I mostly did some screening with Koyfin (the free version). I first sorted the Hong Kong stocks by buyback yields. Koyfin is not really accurate on buyback yield.

Then I did another screening of all HK stocks with primary listing in HK and a market capitalisation over 500 million USD.

Yes, I find more interest in larger caps for me in this market because nano caps sometimes don’t have the dominant structure that I am looking for.

The vast majority of stocks that I will cover today come from my two screenings.

Because I have some capital gain taxes, especially with the 5 bagger Glintt global that I had this year, I did a tax loss selling on one Honk Kong company where I still have some conviction but less than the alternatives: CK Hutchison holdings.

CK Hutchison, the holding company that recovered a lot but is still a 20% loss ex-dividends in my portfolio but not a loss when you include dividends. Nevertheless, it was not a good investment. It could do well, but at 10 times forward earnings, I find much faster growth at the same price, so I took the loss to offset some gains.

I bought 2 new companies, one that I covered with a deep dive already where I showed my bullishness but had no capital, and one that I found with my two screens.

These two companies have P/E ratios under 15 (10 for one), with high ROICs and fast revenue growth over 15%, as I am turning more towards high revenue growth companies with large ambitions.

In this post I will present the companies that I have shortlisted, and the one that I bought, as well as disclose the other buy.

I have lots of companies to analyse further from this list.

1.Midea Group Co., Ltd. - 300.HK

A solid growth company.

Midea Group Co., Ltd., together with its subsidiaries, manufactures and sells home appliances, and robotic and automation systems in China and internationally. The company operates through four segments: Smart Home Business, Smart Building Technology, New Energy and Industrial Technology, and Others. It offers household air-conditioner, central air-conditioner, heating and ventilation systems, kitchen appliances, refrigerators, washing machines, various small household appliances, elevators, high and low voltage inverters, medical imaging products, and robotics and automation system.

Forward P/E of 13 for good growth and a solid dividend yield of 4.7%.

To study

2.Haier Smart Home. - 6690.HK

A company famous in the German investing scene because it has a german listing that trades at a discount. It was also pitched or presented to me briefly in Vienna.

A similar business, a solid growth company.

The forward P/E is 10.7. The german listing is after my calculations trading at a 29% discount or a forward P/E of 7.5.

Haier Smart Home Co., Ltd. engages in the research, development, production, and sales of smart home appliances. The company provides refrigerators/freezers, washing machines, dryer, air conditioners, water heaters, laundry equipment, kitchen and small appliances, and smart home solutions.

It sounds like another good buy. Despite the fact that shares outstanding are going up.

To study

3.Ping An Insurance (Group) - 2318.HK

The leading insurance company of China with a P/E of 7.5 and a dividend yield of 4.6%.

Of course, this is a highly regulated and political company and I haven’t done my research, nor do I have an edge over a Chinese analyst. However, it caught my attention. I believe that with AI now, any person can use AI to understand the context behind a company like this, especially that I can ask Chinese AI models. A small reduction in shares outstanding is a good sign.

To study

4.Great Eagle holdings. - 41.HK

A real estate company based in Hong Kong and operating assets globally

It produces stable earnings and trades at a 7.5 PE and a 5.8% dividend yield. But with minority shareholders, it’s more like 9.5 times earnings.

It has hotel income, development sales income, Champion REIT income.

So with little growth, what happens with the rest of the earnings that is not distributed as dividends? First, there are no buybacks, which is not nice.

It gets reinvested into development projects, with low ROIC. I was interested at first, but I pass. Real estate development is not the best business.

Watchlist, would be interested at 5 times earnings, according to my emerging value framework. Deep value with low growth needs to be cheaper than 10 times earnings.

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This was a network and leisure event and I had a great time while visiting a stunning city centre and practicing my German.

Of course I talked a little but about the newsletter economy and a lot about stocks with Nicklas from Heavy moat investments.

I learned a few very interesting stock ideas - not sure what I can share since these are not my own ideas. I will let them present them on their publications.

I also discussed strategies to apply in order to get more answers from management.

I met great people, including a 17 years old very focused and impressive investor from Poland named Oli. I met also regular Austrian fintwit lurkers who do not post too much but who were super friendly to share their knowledge of the city and culture. I met Swedish Gustav who is 90% invested in emerging markets.

There were other writers like Nonamestocks, Treasure hunting, Augustusville, and the bearish fox Roiss Conclusion. Everyone was super nice.

And I practiced my rusty German. I understood well, but I was mixing up German and Spanish when I spoke, as my brain is mixing up two foreign languages. It was also freezing coming from Spain, so I prepared and looked like an Eskimo - and was still cold.

Advertising: if interested, check my stockwatchAI tool to get a AI powered dashboard and email aggregator for a portfolio. I developed it personally for my own use to follow a 60 stocks portfolio.

With the AI tool development last month, and the trip this month I kind of got behind on following earnings and new companies.

Nevertheless, when you have incredibly cheap ideas, you can just add and add to the same bargains. It will be hard to find better deals.

However I plan to go back to the discovery phase from tomorrow to provide more value for readers.

Back to today’s list, I wanted to catch up on the stocks that I have been adding recently in the technology sector. The recent performance of these stocks is not good but this is how I build future multibaggers, and this is how I built the past multibaggers. They had earnings releases so I went to cover this.

The value is incredible. Maybe one (Delivery Hero) is more speculative as full profit is not yet achieved.

4-PayPal and how to ignore noise

The stock has nosedived after good results, good guidance, good capital allocation and low valuation. One thing I want to remind young or inexperienced investors:

Stop caring about what other investors are doing (selling) and about the market not validating your ideas.

Nearly all great compounders had 50% drawdowns, with investors selling and many super smart sounding investors having bearish opinions. I am so tired to have people ask me not about the fundamentals, but about “investor X is bearish, what do you think”, or “the price is down, maybe the market knows something”. I get too many questions like this and this is testing my patience, maybe because selling pressure makes weak hands sell in reaction and I feel like these people have the worry of someone ready to press the sell button.

The market put Meta to 100$, it put PayPal to 300$ and then 50$. It sent Novo Nordisk to the moon and crashed it down. The market knows nothing. It oscillates around fair value, but sometimes it is very drunk.

Summary: If the fundamentals are good, hold or buy. Look at the primary material from the companies to make your opinion. You can read my opinion, but validate it yourself with the primary material. And do the same with the bearish people who did not analyse the company. Be critical and look at the company results.

At 11 times earnings, it is a screaming buy in my opinion with a near 10% buyback yield.

This valuation is absolutely ridiculous. The first on this article list, but not the last.

3-Delivery Hero stock tanking

The stock is down heavily, probably due to Prosus selling. I am buying but I am underwater.

Delivery Hero is an international food delivery platform.

So what do I think about the Q3 results?

Q3 2025 results were good with revenue up 22%. This is higher than GMV due to own-delivery logistics, AdTech and subscription programs.

Quick commerce, which is store item purchases, grew GMV 24% year on year and revenue 27%. This is impressive and will make Delivery Hero gain more scale and profitability. This business achieved its first ever positive quarterly Adjusted EBITDA in Q3 2025, and is on track to achieve Adjusted EBITDA break-even for the full year 2025.

Europe which is still losing money, is expected to reach EBITDA break even too in Q4 2025.

The growth drives operating leverage:

The EBITDA expected for 2025 is 900 million at least, compared to 1.5 Billion of net debt.

However, Delivery Hero is still losing money overall as financial expenses and non cash financial results caused the company to report losses of 356 million Euros in H1.

Without exceptional results, the losses would have been lower by 164 million Euros.

Also, Delivery Hero is still investing heavily in customer acquisition. I think that down the line this will be reduced.

Delivery hero trades at 0.5 Price to sales and is closing on profitability. I have added (too soon). As they are expecting to keep growing on revenue, they will start paying down the debt and de-risk the investment.

It’s a speculative buy but with incredible upside if things work well.

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