At Spaceship we’re long-term investors. But we still keep an eye on what’s happening in the market day-to-day. These were the companies in our Spaceship Voyager portfolios that made some big moves last week (18/04/22 - 22/04/22).
Top movers
Ramsay Health Care
(Ramsay Health Care is in the Spaceship Universe portfolio and the Spaceship Origin portfolio)
Ramsay Health Care rose 30.6% as the company confirmed it received a conditional takeover proposal from a consortium of investors led by KKR.
Under the proposal shareholders would be entitled to receive A$88 per share less any dividends paid after the date of the proposal.
Given the offer Ramsay directors have allowed the consortium to proceed with due diligence to further study the business and determine if they can put forward a binding proposal.
If successful, the takeover would rank as the biggest private equity-backed buyout of an Australian company.
Bottom movers
Megaport
(Megaport is in the Spaceship Universe portfolio)
Megaport, who sell cloud interconnectivity solutions fell 28.14% last week after they delivered a third quarter trading update that flagged a deceleration in revenue growth and continued cash burn.
Megaport announced quarterly revenue growth of 42.5% to A$27.9 million and customer growth of 20% to 2,541. While the announced figures demonstrated high growth, they didn’t meet analyst expectations.
Some investors are losing patience with loss-making companies that are struggling to accelerate growth after benefiting from the pandemic. We however remain positive on the outlook for Megaport as the company remains a key beneficiary of the digital cloud transformation which is still in its infancy around the world.
Shopify
(Shopify is in the Spaceship Universe portfolio and the Spaceship Earth portfolio)
Shopify fell 19.73% after Amazon released “Buy with Prime” opening up their Prime shipping and fulfillment services to online merchants outside of Amazon stores.
According to Amazon, participating merchants will display the Prime logo and expected delivery date on eligible products in their own online store, offer a simple, convenient checkout experience using Amazon Pay, and leverage Amazon’s fulfillment network to deliver orders. Amazon will also manage free returns for eligible orders.
The headlines are concerning for Shopify but it's not a complete commerce solution that directly competes with Shopify. Amazon is providing only a checkout and fulfillment layer.
We believe Shopify’s independence (it’s not a competing retailer) and its marketplace of commerce solutions is still competitively differentiated from Amazon’s new initiative. Note that the Spaceship Universe and Spaceship Origin portfolios also own Amazon shares.
Enphase Energy
(Enphase Energy is in the Spaceship Universe portfolio and Spaceship Earth portfolio)
Enphase Energy fell 18.03%, trimming some of the strong gains the stock has had over the past few weeks. The market became somewhat concerned after the CEO of the largest renewable energy utility in the United States, Next Era Energy called out significant shortages in solar panels which will force them to delay their planned projects by a year. The solar panel shortages in the United States are driven by anti-dumping tariffs in four South East Asian countries.
We don’t believe Enphase Energy is directly impacted by these developments as their primary product is not solar panels and they also focus on the residential market, rather than the commercial/utilities market. Enphase Energy will report earnings Tuesday 26 April US time, after market.
A note about Netflix
We own Netflix in our Spaceship Origin Portfolio, which is a rule-based portfolio that selects the top 100 companies by market cap in international markets, and the 100 top companies in Australia by market cap. We don’t own Netflix in our Spaceship Universe or Spaceship Earth portfolios.
Several of our consumer and subscription shares such as Spotify and Match.com (owner of Tinder and Hinge) fell in sympathy with Netflix as investors soured on streaming and subscription services.
Netflix’s miss also weighed on consumer discretionary shares such as Warby Parker, Chewy, Adore Beauty, Sea and Pinduoduo as investors grew concerned consumers are pulling back on discretionary services due to high inflation concerns.
This also affected payment services such as Square, Zip, Affirm and Paypal.
Additionally Cloudflare, Meta, Unity Software and Australian Ethical shares fell for no company specific reasons.
One or more of the Spaceship Voyager portfolios invest in Ramsay Healthcare, Megaport, Shopify, Amazon, Enphase Energy, Spotify, Match Group, Warby Parker, Chewy, Adore Beauty, Sea, Pinduoduo, Block, ZipCo, Affirm, Paypal, Cloudflare, Meta, Unity Software and Australian Ethical. Please refer to the Spaceship app or our website for more information on what each portfolio invests in.
Important! We’re sharing with you our thoughts on the companies in which Spaceship Voyager invests for your informational purposes only. We think it’s important (and interesting!) to let you know what’s happening with Spaceship Voyager’s investments. However, we are not making recommendations to buy or sell holdings in a specific company. Past performance isn’t a reliable indicator or guarantee of future performance.
