Wise (FY22 earnings)

Wise (LSE: WISE) is a fintech company that provides a money transfer service. It allows customers to send money abroad and get paid in other currencies. Wise is expected to unveil its FY22 earnings results for the year ending March 2022 on Tuesday 28 June.

Although there’s no previous record to compare with in terms of earnings per share (EPS), the earnings preview indicates that revenue is expected to grow by 32%. This is seen as generally positive as Wise continues to take market share from the likes of PayPal and Western Union. Having declined over 60% since its initial public offering, a better-than-expected number on its top and bottom lines could see the Wise share price recover from its bottom.

Moonpig (FY 22 earnings)

Moonpig (LSE: MOON) is an internet-based business. The company makes its money mainly from selling personalised greeting cards, flowers, and gifts. The FTSE 250 firm is expected to release its FY22 earnings results for the year ending April 2022 on Wednesday 29 June.

Moonpig is expecting to show a slight decline in revenue for the most recent year. This is due to the slowdown in sales after the pandemic. Nonetheless, the online business is still expecting its revenue to come in above pre-pandemic levels, with its bottom line also showing an improvement.

Mulberry (FY 22 earnings)

Mulberry (LSE: MUL) is a British fashion company. It is best known for its luxury leather goods, particularly women’s handbags. The small-cap company is expected to post its FY22 earnings results for the year ending April 2022 on Wednesday 29 June.

The earnings preview points towards a slight growth in revenue despite a slow down in retail sales lately. This is due to its status as a luxury brand. Due to a lack of liquidity in the stock, its share price has largely stayed unmoved this year. Consequently, there’s a lack of coverage on the stock. Nonetheless, higher revenue with a better EPS could have investors jumping for joy, sending the stock higher.

The post Earnings preview: Wise, Moonpig, Mulberry appeared first on The Twelfth Magpie.

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John Choong has no position in any of the shares mentioned at the time of writing. The Motley Fool UK has recommended PayPal Holdings. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Revenue rockets

Today’s results for the full-year to the end of April were certainly nothing for holders to complain about. 

Having despatched over 50 million orders, Moonpig’s revenue rose 113% year-on-year to a little over £368m. According to the company, this was due to growth in new customers and people making more frequent purchases as a result of multiple Covid-19 lockdowns. I certainly count myself within the latter category. 

The good news continues. Adjusted earnings came in at just over £92m — at the top end of guidance issued by the company in February. Pre-tax profit came in only 3% higher than last year but this was due to costs associated with the IPO. 

All this sounds pretty positive. So, why is the Moonpig share price crashing back to earth today? It appears to be down to the company’s outlook. 

To the moon… and back

Despite the new financial year starting “moderately ahead of expectations” thanks to the delay in Boris Johnson’s road map out of lockdown, Moonpig said that it had noticed the number of orders on its site starting to normalise, albeit from “elevated levels“. Importantly, it thinks this drop will continue.

Ultimately, the company expects the frequency of orders to steady around 5% higher than pre-pandemic levels. As a result of this, Moonpig thinks this financial year’s revenue will fall to somewhere between £250m and £260m. That’s clearly a big step down from last year’s headline number. 

Another thing that may be spooking investors is news that management will “continue to prioritise additional investments in marketing and market share capture” rather than focusing on short-term profit. 

Where’s the moat?

There are things I like about Moonpig. In addition to boasting the sort of margins you’d expect from a pureplay online operator, the company’s “unique gifting dataset” should indeed allow it to personalise experiences for customers as management claims.

Speaking as a customer, however, I’m not sure that I would ever buy anything other than cards from the company. It may be adding hugely popular brands like Lego to its range, but a simple online search shows that I can get the same products far cheaper elsewhere. In other words, Moonpig is a convenience play. If I’m organised, I won’t need it. As a potential investor, that would trouble me.

I’m also struggling to find an economic moat here. FTSE 250 peer WH Smith has rival Funky Pigeon in its greetings card arsenal. What would keep me loyal to Moonpig? And will we still be sending greetings cards in, say, 2031 anyway?

No for me… yet

As investments go, I’m torn. While the fall in the Moonpig share price back to near its initial offer price makes it more attractive, I’m not totally convinced the company will grow market share as easily as it thinks.

With this in mind, I wouldn’t feel comfortable buying yet. Expectations have been reduced, but the shares could drift for a while.

The post What’s going on with the Moonpig share price? appeared first on The Twelfth Magpie.

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Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.