Grab (GRAB) vs Rocket (RKT): Which is a better financial stock?

Stocks of Grab Holdings Limited (NASDAQ:GRAB) declined 37.3 per cent during the trading session on Thursday, March 3, as investors were left disappointed due to its financial results for the fourth quarter and fiscal 2021.

Grab Holdings develops delivery management, financial services, mobility, and enterprise software solutions through its subsidiaries. The company announced on March 3 that it posted a US$ 1.1 billion loss and a significant drop in revenue.

The loss and drop in revenues could be due to the promotional offers and high driver incentives offered by Grab Holdings.

A look at Grab's financial performance

In Q4 2021, Grab Holdings' revenue was US$ 122 million, a decline from US$ 219 million in Q4 2020. This reflected a decline of 44 per cent year-over-year (YoY).

The loss for fiscal 2021 jumped to US$ 3.56 billion compared to US$ 2.75 billion in 2020.

On March 3, the GRAB stock plunged to an all-time low of US$ 3.09 per share and reportedly wiped-off over US$ 7 billion from its market capitalization.

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In Q1 2022, Grab Holdings expects its deliveries gross merchandise value (GMV) to be between US$ 2.4-2.5 billion. Meanwhile, it expects its mobility GMV to be in the range of US$ 0.75 to US$ 0.80 billion.

In the financial release, Grab Holdings mentioned that it is getting close to achieving the core food delivery segment adjusted EBITDA breakeven by the first half of 2023.

The performance of GRAB stock has been poor, and let’s take a look:

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Bottom line

There are a lot of stocks from the financial services sector, and our search for a cheap financial stock brought us to Rocket Companies Inc. (NYSE:RKT), a provider of a wide array of financial services.

At market close on March 3, stocks of Rocket Companies closed 1.3 per cent higher at US$ 13.98 apiece.

In Q4 2021, Rocket Companies' revenue was US$ 2.6 billion, which represented 36 per cent increase from Q4 2019. Meanwhile, the company posted a profit of US$ 865 million in the fourth quarter of last year.

In Q1 2022, Rocket Companies expects to gain on sale margins of 2.8 to 3.1 per cent and closed loan volume between US$ 52 to US$ 57 billion.

Since the past week, the RKT stock surged about 21 per cent and 13.2 per cent in a month.

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Please note, the above content constitutes a very preliminary observation or view based on market trends and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.