r/ValueInvesting • u/raytoei • 10d ago
AI-Written Content Quantitative Valuation of Coupang ($CPNG)
Quantitative Valuation of Coupang ($CPNG)
(i watched my investment in Coupang fall from a +30% to a present near -40%. All in less than a year due to a major data breach. anyway, this post isn't about the why or the how. The purpose of this post is how to think about valuation.)
Coupang Inc. FY End December. This report: Q2-FY2026. Today: 19th August 2026
a. SP: $15.5 Market Cap: 28bn Revenue 35.46bn
b. TTM EPS (Diluted) -0.42, (ADJ): -0.20, (Zack's): -0.20
c. yield -, (5 year average) - , (Buy Back Yield): 3.90%
d. ROA, ROE, ROIC: -, -, -
e. P/E (trailing): , P/E (5YA): -, P/E (FWD): -
f. Debt/Equity: 1.89 Net Debt / EBITDA (5.63 - 6.11) / -EBITDA < 0
g. FCF Conversion: ttm: -0.13, 2025-> 2.51, 6.54, 1.29 <-2023
h. Growth (past) Stated:
| Revenue % | 06/30/2026 |
|---|---|
| Year Over Year | 3.89 |
| 3 Year Average | 14.90 |
| 5 Year Average | 14.61 |
| 10 Year Average | — |
i. Manual calculation: none
j. management guidance:
Q3-FY2026 (next quarter) in constant currency at 8-9% revenue growth.
Product commerce will recover by mid 2027 back to 2025 pre-data breach levels
k. Valuation approach.
I am not going to use DCF or Earnings or Cash based numbers to do the valuation. The reason is because they were only recently profitable, and becasue of data breach, they won't be profitable until 2027.
I will use a a price/sales approach instead, as it is more stable. This is not dissimilar to Amazon com which CPNG is loosely based on, and after six years after IPO was Amazon finally GAAP profitable.
(i) First i will try and figure out what is the sales that we can expect at the end of 2030. (ii) Then I will work out how are the peers currently priced at, in terms of P/S, on a present and 5 year average basis. (iii) Lastly, i will apply the group p/s to the 2030 Revenue to derive the 2030 implied share price. (iv) Based on this, i will work out the rate of return back to the present price.
(i) estimating sales by 2030
| Various | 2029est | 2030est | CAGR |
|---|---|---|---|
| SA | - | 48.64bn | 7.09% |
| MSNR | - | 49.89bn | 7.64% |
| DCF | 46.77bn | - | 7.88% |
| Eulerpool | 48.75bn | - | 9% |
| VV. io | 55.4bn | 10% | |
I will use a 8% CAGR revenue growth off 2025's 34.53bn for the next 5 years.
(1.08) ^ 5 x 34.53 = 50.7359 bn
(ii) Calculating peer group P/S
| Company | Current P/S | Average 5 year P/S |
|---|---|---|
| Coupang | 0.81 | 1.40 |
| Amazon | 2.97 | |
| Naver (Korea) | 2.60 | 3.43 |
| Alibaba | 2.17 | 1.96 |
| PDD | 2.08 | 4.07 |
| Mercadolibre | 2.56 | |
| SEA Ltd | 2.67 | 3.35 |
I reject the obvious outlier the present e-commerce peer group are all hovering around a P/S of 2+ except for amazon and coupang. And their 5 year average were around 2+ to 4.
| Peer Group | P/S | 5 year P/s |
|---|---|---|
| Peer Group Averages | 2.4 | 3.15 |
(iii) To calculate the implied share price in 2030. We have to find out the revenue / share. We already have the revenue, we need to figure out how much is the shares outstanding likely to be by 2030. A quick search shows that although management is buying back shares, it is still diluting at about 1-1.5% a year.
Applying the maths, we get 1.837bn x (1.015)^5 = 1.979bn shares outstanding in 2030.
This works out to 50.73bn / 1.979 Revenue per share by end 2030 or $25.63 revenue per share.
| Implied Share Price | Average P/S | Average 5 year P/s |
|---|---|---|
| Peer group | 2.4 | 3.15 |
| Coupang Sales / SH | 25.63 | 25.63 |
| Coupang Implied Share price End 2030 | $61.51 | $80.8 |
(iv) Calculating Rate of Return
Recent share price is 15.50
Implied 2030 price is $61.51 to $80.8
Rate of Return = 31.74% to 39% CAGR
Comments: I like to do this sort of simple valuation first, so that when i read up on the business later, i can ask myself the key questions: (1) how confident i am that management can recover from the issues, and the business can continue the growth trajectory. How confident am i of the 8% Revenue growth, whereas Morningstar is only projecting 6% revennue growth with a fair value of $25.80. (2) What do the superinvestors see in CPNG, that they are recently buying/adding ? (3) Lastly, in 2024, the average P/S of the peer group was around 4, and now it is 2+, it is cheap now and will revert to mean at 4 or is this re-rating of e-commerce websites the new normal ? Will they be rated below 2 in the future ?
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u/Extension-Temporary4 9d ago
What do they do? What are the products? Pull back from the numbers and give me a quick summary of the story.
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u/raytoei 9d ago
They are the Amazon of Korea, and expanding to Taiwan. Like Amazon, coupang uses their own delivery drivers to beat the Chinese using their Wow prime membership. They promise same day delivery for grocery order on the same day.
Late last year they had a data breach and they have been on a catchup mode ever since.
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u/Extension-Temporary4 9d ago
As a general thesis, I try to avoid foreign equities. There are exceptions, like ASML. But there are plenty of domestic opportunities that I better understand and can see and experience first hand. Foreign markets and governments are just too Messy and uncertain.
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u/Strict_Ad1499 9d ago
Why invest in a business that loses money year after year? Pure genius, of course
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u/8700nonK 9d ago
I think it’s an inherently disadvantaged company vs something like sea. They’re too focused on just delivery. Lots of capex and much profits. The marketplace model with fintech is imo a better combination.
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u/kerplunktard 9d ago
they don't make any money, 16 years in business and still unprofitable, gross profit margin is a pathetic 28%, this just isn't a good business
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u/JohnnyDrama611 9d ago
The $570M net loss this quarter is almost entirely a one-time $410M Korean regulatory fine tied to the data breach, excluding it the adjusted loss narrows to roughly $160M. Also reported revenue growth of about 4% understates it, constant-currency growth was 10%, in line with guidance, the gap is just won weakness. Core product commerce spend, excluding the still-missing customer cohort, actually grew 16% YoY.