GoTo hits new 52-week low amid share buyback plans

Photo credit: GoTo Group

GoTo Group‘s stock prices fell to a record low of 50 rupiah (US$0.0031) on June 10, but it ended the trading day at 56 rupiah (US$0.0034).

This is below the Indonesia-based company’s previous all-time low of US$0.0033, which it logged in October 2023. Its share prices recovered slightly to close at a high of US$0.006 in November 2023, but it has been on a decline since then.

However, GoTo’s stock prices have been on an upward momentum since its financial results for the first quarter of 2024 were released. The company, formed via the merger of super app Gojek and ecommerce player Tokopedia, posted an 89% year-on-year growth in adjusted EBITDA.

Even though GoTo’s shares have dropped, Indonesia’s gross domestic product growth remains steady, with an annual increase of over 5% in recent years, noted Pang Xue Kai, co-founder of Untukmu AI, in a LinkedIn post.

“GoTo has often been seen as a barometer for Indonesia’s tech-driven economic pulse. Therefore, its significant drop may hint at underlying challenges that we might not fully understand yet,” added Pang, who is also the founder and former CEO of Tokocrypto.

Meanwhile, GoTo previously announced plans to buy back US$200 million of its shares.

“Cash flow is improving, and as there is significant value in our stock, we believe a buyback is prudent as we look to ensure we are using our resources efficiently,” GoTo CEO Patrick Walujo said in a statement last May.

In addition, financial services firms like CLSA and Jefferies have maintained their outperform and buy ratings, respectively, on GoTo Group as of last week. An outperform rating typically means that analysts expect a good rate of return on a stock, but it may not be the best performer on an index.

Currency converted from rupiah to US dollar: US$1 = 16,293.23 rupiah.

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