GGR - Gogoro: Still Expensive Despite Potential Recovery In Sales

2024-05-21 04:10:33 ET

Summary

• The company’s operating revenues went down by 12.1% year-on-year to $69.7 million, while the gross margin slumped to 6.4%.
• In my view, Q2 and Q3 should be stronger thanks to the start of sales of Pulse and Jego and an improvement in scooter sales in Taiwan.
• Yet, Gogoro is likely to remain in the red over the remainder of 2024, FCF is nowhere near positive territory, and the price to book value ratio is 1.6x.
• While short selling seems viable, it could be best for risk-averse investors to avoid this stock as the short squeeze risk is high.

Introduction

I've been following Gogoro (GGR) closely, and I've written a total of five articles about the company on SA to date. The latest one came out in February 2024 and back then I said that its expansion beyond Taiwan had been underwhelming....

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