Grab Is Down 83.5% and Growing. Here's Why It Has the Makings of a Monster Stock for the Next Decade.
Grab stock has continued to lose ground this year, but growth for its business tells a different story.
Grab, a Singapore-based company offering ride-hailing, restaurant delivery, grocery delivery, and other services, has experienced an 83.5% drop in its share price. Despite this decline, the company is exhibiting strong growth. As of now, Grab is valued at 21 times its expected earnings and 2.7 times its expected sales, which could make it a lucrative stock for long-term investors.
The company's revenue grew by 22% year-over-year in the second quarter, reaching $997 million, and its net income increased to $235 million. The gross margin stands at approximately 23.5%. Additionally, Grab has generated $450 million in non-GAAP free cash flow over the past year.
With a dominant position in Southeast Asia's ride-hailing and delivery markets, Grab also provides fintech services such as digital payments, loans, banking, and insurance for both consumers and merchants. The company recently acquired Atome, positioning itself in the buy now, pay later space, which complements its core services.
Grab's services are available in eight Southeast Asian countries, serving more than 460 million people. As of the end of Q2, the company had around 54 million monthly active users. The company's engagement figures indicate an impressive position in its core service categories, but also suggest significant potential for expansion in terms of user growth and average revenue per customer.
While investing in international stocks involves additional risks compared to U.S. counterparts, Grab's solid fundamentals and substantial room for expansion make it an attractive option for long-term investors.
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