The following is a smoothing together of some of my notes. I wish I could invest more into my investment analysis. I hope it’s not so garbled as to be unhelpful.
Other than today, Mr Market liked Q1FY2021 presented by MDB. I bought at $43 a month or so after IPO and sold at $131 when what I thought there would be a lul to hyper-growth from the mLabs contribution being soon to be fully digested and Atlas not yet being a large enough portion of total revenue.
My investment thesis has always been: It’s likely that MongoDB will continue evolving from a core database solution to a full-featured data platform.
Here’s some of the recent numbers:
Q1FY2021 Rev Growth Rate: 46% and Sub Rev Growth 49%
Q1 FY2021 Earnings Report released for MongoDB stated Atlas, their cloud offering, revenue was reported to have increased 75% year/year and now making up 42% of total revenue.
Q1 FCF was ($8.5M) for a FCF margin -6.5%, compared to FCF of $2.8M or FCF margin of 3.1% in the year-ago period.
And, outlook from the Q1 call, the CFO did state: Atlas revenue is based on consumption and may decline due to COVID.
Non-GAAP gross margin 73% in Q1 FY2021. This compared to 70% in Q1 FY2020.
Q1 Non-GAAP operating loss being $7.4M, for an operating margin of -5.7%. This compared to an operating loss of $12.6M in the year-ago period, representing an operating margin of -14%. Q4 operating margin was -10%.
On the MDB Q1 FY2021 earnings call, the CFO stating “if you actually back out the contraction or the drag from mLab, organic Atlas more than doubled.”
Despite the run up after Q1 results, I see share price continuing to increase with increased rev growth now that mLABS is digested into the numbers (easier comparables) and Atlas likely more than 45% of Revs next quarter.
Not exactly hidden growth; but, this with all the feature updates (which I wish I had time to write about - but myself not being a developer would not hold much weight perhaps) I did buy back in Today with a 4% position.
There is obviously more to consider when selecting a new investment; but, since I am familiar with this company and it’s CAP and SAM (huge), being Founder led by a Technologist with winning experience etc I thought that this and the above would be good rationale for making the 4% re-entry into this name.
Perhaps I’m just looking to hard for where to put money from allocations that have just gotten to big to feel comfortable with (eg: with DDOG at 17% and ESTC with a disruptive pricing model competing in Observability- when is ESTC good enough? Understanding that the TAM is big enough for many to win am I just more comfortable with a 12% allocation in DDOG? Apparently so. That’s what I did .)