Encouraging CRWD trend

Investment Analysis Clubs Saul’s Investing Discussions
21

I have not subscribed long enough to Bert’s service or read enough of his posts yet to completely understand his methodology, but one common theme that I think I may have picked up on is his ability to evaluate companies taking into consideration valuation (ie. EV/S) while looking at valuation through the lens of growth. (Not strictly, but one of many hard and soft metrics that he uses). It seems to me that he often expresses an opinion on EV/S as it pertains to a “growth cohort”, such as 20%, 30%, 40% growers. I think he may be implying that high growth companies have to be evaluated differently; similar to points I believe some others have made above in this thread.

I am certainly guilty of investing in many companies discussed on this board that would never make the cut for my portfolio if I subjected them to a “valuation filter”. I believe that winners win. I won’t be right all the time, but it has worked for me. YTD I am up 37.4%. I suffered dearly during the heat of the rotation, but at the end of the day, I believe the market is efficient and recognizes quality and duly rewards smart growth.

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22

Hoping to add value to this aboard, albeit a little, I earlier posted this:

Share count
July 2018 - 44,105,000
July 2019 - 130,091,000
Increase 294%

Revenue
July 2018 - $55,701,000
July 2019 - $108,108,000
Increase 95%

Cash Flow
July 2018 - ($66,494,000)
July 2019 - ($77,866,000)
Increase 17%

After some kind guidance off board I realize BOY I REALLY BLEW IT!!

From their last press release on the subject CrowdStrike said:

Revenue: Total revenue was $108.1 million, a 94% increase, compared to $55.7 million in the second quarter of fiscal 2019.

Cash Flow: Net cash used in operations was $6.2 million, compared to a use of $28.7 million in the second quarter of fiscal 2019.
Free cash flow was negative $29.2 million, compared to negative $35.7 million in the second quarter of fiscal 2019.

OK, at least I got the revenue right. Share counts, particularly right after an IPO, can be tricky. I encourage others to follow the links posted in the thread for clarification. And though I got my Cash Flow information from the top line on the 10-Q there were adjustments which were not included. I apologize for the inaccuracies.

The bottom line is this: I’m still learning, and this is a great place to do it.

Best,

Jeb

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23

To clarify further why the FCF is so much more negative than the OpCF, from pg 58 of the 10Q


**Revenue                                                                 108.1**

__**Cash used in Ops (Op Cash Flow)**   		   		          6.2		neg 6%__
 **Less Purchases of Property and Equipment			         21.6**
 **Less Capitalized internal use software				  1.3**

__**Free Cash Flow (negative)**				                 29.2           neg 27%__

It wasn’t anything malign, just mostly purchases of property and equipment.

Saul

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