RKUNF - Rakuten: Still Neutral Considering Results And Outlook

2024-05-19 01:59:22 ET

Summary

• Rakuten's Q1 2024 revenue was in line with the consensus estimate, but its operating losses for the recent quarter were much wider than expected.
• The Fintech segment's top-line growth outlook is favorable considering its restructuring plans; the Mobile segment boasting a single-digit subscriber share in the Japanese market is likely to remain loss-making.
• I have decided to stick with a Hold rating for Rakuten, following an evaluation of the performance and prospects of its key Fintech and Mobile segments.

Elevator Pitch

I rate Rakuten Group, Inc. ( RKUNY ) ( RKUNF ) [4755:JP] stock as a Hold. Previously, I wrote about RKUNY's cash flow generation and debt refinancing in my prior September 19, 2023 update ....

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