Coupang (CPNG): A Decade-Defining Growth Play in E-Commerce and Luxury Retail

Coupang (NYSE: CPNG) sits at a pivotal inflection point: a South Korean e-commerce titan with a $48 billion market cap, a $1 billion+ annual free cash flow (FCF) engine, and a global expansion playbook that’s delivering outsized returns. Yet its stock trades at a 52-week low of $26.84—a price that ignores the company’s operational resilience, undervaluation, and high-growth trajectory. This is the rare moment to buy a decadelong winner.

1. South Korea’s E-Commerce Kingpin

Coupang’s dominance in its home market is unassailable. With 23.4 million active customers (up 9% YoY), it’s not just a platform but an ecosystem. Its Rocket Delivery—a 30-minute-to-next-day service—has turned customers into loyalists, driving $6.87 billion in Q1 2025 core revenue (up 16% YoY). The company’s secret? Automation and scale.

Its FLC (Fulfillment, Logistics, and Commerce) initiative has reduced costs for third-party sellers, boosting selection and engagement. Today, 25% more customers buy across nine or more categories—a metric that reflects Coupang’s ability to monetize its audience.

2. Farfetch: Turning Luxury Losses into Global Profits

Coupang’s $1.2 billion acquisition of Farfetch in 2024 was a masterstroke. Once a money-losing venture, Farfetch is now on track to hit breakeven in 2025, with its $4 billion annual transaction volume and 49 million monthly global users. The integration is paying off:

• Operational streamlining: Farfetch’s costs have been slashed, while its logistics are now backed by Coupang’s infrastructure.
• Luxury market growth: The $1.2 trillion luxury sector is ripe for disruption, and Farfetch’s curated selection of brands like Dolce & Gabbana and Kiehl’s positions Coupang to capture a larger share.

By 2030, this could add $1 billion+ in annual FCF—a tailwind the market hasn’t priced in.

3. Taiwan: The Next Korea?

Coupang’s Taiwan expansion is its most audacious bet—and it’s working. Launched in late 2022, Taiwan now sees 23% sequential Q4 2024 revenue growth, driven by organic growth (over 90% of expansion). The WOW membership program and dawn delivery (free next-day delivery for remote areas) are replicating Coupang’s Korean playbook.

The numbers speak for themselves: 500% YoY selection growth through partnerships with global brands like Coca-Cola and local suppliers. Taiwan’s margins will improve as scale kicks in, turning it from a loss center into a profit driver.

4. Undervalued on a P/FCF Basis

The stock’s dip offers a rare entry point. Let’s do the math:

• Trailing FCF: $1.0 billion (TTM).
• Shares Outstanding: ~1.8 billion (as of April 2025).
• FCF per Share: ~$0.56.
• P/FCF Multiple: $26.84 / $0.56 ≈ 48x.

High? Yes—but consider this:
- Coupang’s FCF could double to $2 billion by 2027 as Taiwan matures and Farfetch turns profitable.
- Competitors like Amazon trade at 20x FCF, but Coupang’s growth rate (21% constant-currency revenue growth) is nearly double theirs.

This is a P/FCF compression story: even a 30x multiple would imply a $16.80 FCF per share, pushing the stock to $50.

5. Risks? They’re Manageable

Critics cite currency headwinds, high tax rates (53% due to Farfetch losses), and Taiwan’s early-stage losses. But:
- Currency: The won’s weakness is temporary; Coupang’s U.S. dollar revenue growth (14% YoY excluding Farfetch) is stable.
- Taxes: The 20% cash tax rate (excluding Farfetch) leaves plenty of room for profitability.
- Taiwan: Its $1 billion+ annual revenue run rate is a fraction of Korea’s $30 billion—scale is inevitable.

Conclusion: Buy Now, Reap for Decades

Coupang is a once-in-a-decade opportunity to own a company with:
- Unrivaled e-commerce scale in its home market.
- A luxury play that’s turning around.
- A Taiwan growth story that mirrors its Korean success.
- $1 billion in buybacks signaling management’s confidence.

The stock’s current dip is a mispricing—a chance to buy a $50+ stock at $26.84. This isn’t just a recovery trade; it’s a decade-long growth story.

Action: Buy CPNG now. The next leg up is coming.

Disclosure: This analysis is for informational purposes only. Always conduct your own research or consult a financial advisor before making investment decisions.