Earnings Exuberance

The slides have all the goodness: from

I am surprised the market reaction is a 20% increase. Most of this seems good but in line with past performance. What am I missing here?

Guiding up is nice, but this isn’t a huge adjustment:

…increase its full-year guidance. Previously, it had expected full-year revenue of $932 million at most. Now, it expects full-year revenue of $942 million at least.
Why Stock Soared Higher Today

Perhaps someone with time to listen to the call will be able to report some news that makes the difference.

It is worth noting that this quarter included a price increase. Since is still my largest position at around 17% now, I think I am going to trim it down to something more reasonable and review what is going on from there.

I haven’t shared my portfolio in quite some time, so I might as well put a tiny update here. With this trimming of MNDY, I added a small position in NU, increased my position in ELF and slightly bumped up AXON; and I finally sold SNOW. Leaving me with:

Name Symbol % of Port.
1 Samsara Inc IOT 16.3%
2 Celsius Holdings, Inc. CELH 14.0%
3 Monday.Com Ltd MNDY 12.3%
4 Axon Enterprise Inc AXON 12.0%
5 elf Beauty Inc ELF 11.3%
6 Crowdstrike Holdings Inc CRWD 9.0%
7 NVIDIA Corp NVDA 6.7%
8 MercadoLibre Inc MELI 6.0%
9 Zscaler Inc ZS 4.5%
10 Cloudflare Inc NET 4.0%
11 Nu Holdings Ltd NU 3.6%

Where is the exuberance? The stock sold down -25% vs. where it was in Q1 on what? They have done nothing but execute and raise guidance since then and the stock price is ~unchanged.

Me thinks the market sentiment towards these ~30-35% growth SaaS Co’s has gotten overly negative. Just my opinion. MNDY is still not expensive even after the 18% pop @~9.5x NTM EV/S



They’ve (finally) reported a jump in sequential revenue over $13M to $14.31M, and I anticipate further growth to around $19M in upcoming quarters. This signals promising progress:


I assume, the primary driving force behind this is the increase in prices, coupled with the expansion through opening up Monday Sales CRM and Monday Dev to all customers. It’s worth noting that these changes aren’t yet reflected in the Net Revenue Retention rates since those metrics look backward.

Operating and free cash flow margins exceeding 41% are certainly impressive figures.

The fact that the company achieved profitability relatively quickly and maintained strong execution, especially during the past challenging couple of years, speaks volumes about its resilience and adaptability (and mission criticality?).

Nevertheless, the relatively lower absolute revenue base, with $217M revenue in Q1 growing at 34% YoY, tempers my optimism (a bit). To put it into perspective, businesses like SNOW or CRWD are growing over 3X that size at a similar growth rate.


Add to this the market noise around a Google take out of Hubspot, a direct competitor in the CRM arena which is growing at 23% and valued over 11.5x NTM EV/S, is probably putting a valuation marker into the mix here. (As is the SquareSpace take private move by Permira).



I find their slides, at least the ones posted here, pretty disingenuous. Management has added the swooping up arrows as if everything is growing exponentially, trying to mask that nothing is growing exponentially. They couldn’t add them to DBNRR, which has decayed since Q1-22.



I don’t believe management is trying to hide anything. They grew customers spending more than $50k ARR by 30X during the past 4 years (a CAGR of 134%), and it’s still growing at a decent pace.

Net dollar retention rate is a trailing four-quarter, weighted
average calculation, dragged down by tough times from the past. I’m pretty confident we’ll see that metric go up again later this year.