Grab Holdings Stock Pulls Back, Analysts Adjust Positioning

Grab Holdings stock (NASDAQ:GRAB) is a notable pre-market decliner today, down 8.05% despite positive earnings report. The company in fact reported its first full year of positive group-adjusted EBITDA, yet the outlook was below expectations.

Grab's revenue came in at $764 million, above the forecast for the quarter ($753.94 million), following a revenue growth of 21.65% over the past twelve months. Furthermore, Grab achieved positive full-year adjusted free cash flow amounting to USD 136 million, showcasing its operational efficiency.

Looking ahead, Grab's forward guidance projects significant revenue growth between 19-22% in 2025. The company also aims to improve group EBITDA to revenue margins by 200-300 basis points, with expectations of 40-50% growth in EBITDA relative to 2024. The revenue outlook of between $3.33 billion to $3.40 billion disappointed the street, who had been expecting $3.40 billion.

After a run of 12.66% year-to-date, and 53% over the past 12 months, anything but upside movement was likely to be harshly treated.

CEO Anthony Tong highlighted the untapped market potential in Southeast Asia, pointing out that Grab is currently serving only one in 20 Southeast Asians. This suggests significant growth opportunities. Meanwhile, CFO Peter Owey emphasized a robust long-term financial strategy focused on dollar EBITDA free cash flow.

Analysts came in with some upside revisions on the day, with BofA increasing from $5.10 to $5.80, and Barclays moving their price target on GRAB to $6.50 from the prior mark of $5.50. Daiwa went the other way, moving their PT down to $5.20 from $6, with the company's 2025 EBITDA guidance highlighted as disappointing markets.

While Grab Holdings Ltd has achieved a substantial milestone in its financial performance, balancing investor expectations with strategic growth initiatives will be critical as the company navigates its future.