Hortonworks kills it!

Investment Analysis Clubs Saul’s Investing Discussions
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Hortonworks (HDP) reported on the December quarter of 2017 today, and the headline is Positive cash flow for the quarter!!! Here are the rest of my notes:

Revenue: $75M, up 44% YoY. This was a $4.54M beat.

Subscription revenue: $58M, up 63% YoY

Adj. EPS: -$0.24 (in-line)

Total Deferred Revenue: 275.2M! This is up 48% YoY
Def Rev this quarter: $44M! (Wow!)

Positive Cash Flow From Operations: $6.4M

They had TWENTY $1M+ projects in the quarter. The most they’d ever had in any quarter before this one was TWELVE.

Dollar-based net expansion rate: 122% (over the trailing four-quarter period) – this ticked up this quarter

Avg Deal Size: $207k (this was the largest average deal size for any quarter in 2017)

Conclusion

Hortonworks may not be completely finished burning cash, but a cash positive quarter shows they may be getting close. They still have a LOT of dilutive SBC…that’s just the model. But the shares are priced accordingly, and I think long term, they’re attractive.

On the positive side, the 63% growth in subscription revenue, the huge increase in $1M+ deals, and the cash flow positive quarter add up to a company that is heading in the right direction FAST.

I’ll be adding on any pull back, market-driven or otherwise.

Bear

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Weird that the stock dropped slightly after hours tonight.

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Weird that the stock dropped slightly after hours tonight.

Yeah that was me! Nasdaq’s website is down, but I think the shares I got are the only shares that were traded after hours! Only part of my order filled.

Bear

PS - Remember not to put much stock in AH activity for small caps. A lot of times only a few shares change hands when the market is closed.

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I opened a position this afternoon after the stock was down almost 10% for the day.

Deferred revenue up 48% YOY? Add that to 122% $-based net expansion rate? Sign me up for that all day.

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