Symbotic (NASDAQ: SYM) stock is up 50% on annual results. As opposed to Ocado (LON: OCDO) which is only just back to about where it was a year back. But they’re both - at one level of detail - trying to do the same thing. Which is to roboticise the distribution warehouses. That stock price performance difference between the two might tell us something about who is winning that particular battle.
Symbotic came to market as a SPAC a little while back and then just released results: “Q3 GAAP EPS of -$0.07 in-line. Revenue of $311.84M (+77.6% Y/Y) beats by $50.82M.
For the fourth quarter of fiscal 2023, Symbotic expects revenue of $290 million to $310 million, and an adjusted EBITDA of $0 million to $3 million.” It’s possible to winder about that a little. If revenue is well ahead of expectation then shouldn’t we expect an earnings beat? Or perhaps they’re following the Amazon idea - whatever you do earn plow back into faster expansion.
But whichever explanation we want to use there, the stock has certainly benefitted:
Symbotic stock price from Google Finance
Symbotic also has the backing of Softbank but then with their recent track record how much of a positive is that? The real issue at Symbotic is that they’ve got the job of automating, roboticising, the Walmart distribution centers.
Ocado on the other hand, the stock’s up but on the back of the Autostore settlement. “Ocado (LON: OCDO) (OTCPK: OCDDY) shares are up 11% in London. OCDO shares rose on the announcement that the Autostore litigation is now at an end. Clearly the major assumption here is that Ocado has won the litigiation. Certainly, some parts of it make that seem likely. But it's also possible to read this another way. That the case was not, perhaps, as strong as at first thought. Further, that this actually increases, not reduces, the competitive threat from Autostore.” And it’s not that long ago that Ocado was London’s most shorted share.
Sure, it’s possible to insist that they’re in slightly different aspects of the market. Symbotic in the warehouse, Ocado in the pick and place for individual orders arena. But it is fairly obvious that there’s a divergence in performance here. Now, whether that’s going to continue is of course another thing but that’s what the current bet is.