Hi Everyone,
If you strictly looked at the stock price, Monday started the year underwhelming, and you could have gotten out based on that. If you care about business results and believe the stock price will eventually catch up to the business, you and I were rewarded yesterday. The business has remained strong as the company implements a rolling price increase that should improve revenues over the next year and it continues to improve its product. Here’s some highlights:
Revenue increased 32% YOY to 268 M.
Net Retention rate sits at 112%.
Diluted non-GAAP earnings per share increased 66.2% YOY to $1.08.
Diluted GAAP earnings per share increased 79.2% to $0.43.
GAAP based PEG = 0.95 non-GAP based PEG = 1.14
PS = 17.3
AI agents to ID recurring customer service problems, unlock sales deals, and analyze project risks was released.
To sum things up, Monday continues to improve products in a way that maintains market leadership whilst growing profits faster than it grows revenues. What a wonderful, under appreciated company.
Congrats on the gain! Overall it was a nice report, but what keeps me on the sidelines at this price is that their Q1 guidance appears pretty weak. In Q4, they guided $262M and delivered $268M, which was 2.29% beat. Their Q1 guidance is $276M. With a same 2.29% beat, it’ll be $282.3M, which will lead to a deceleration of the YoY growth from 32% to 30%, and a deceleration of QoQ growth from 6.77% to 5.34%. This will continue the growth deceleration trend of the company and I expect further deceleration because 5.34% QoQ growth annualizes to only 23% YoY.
Monday has been an instructive SaaS player from the start. They were bold enough to have some of the highest expense to revenues early on (200-300%), spent massively on direct mass market YouTube advertising for its business and goes on to produce some of the most impressive operating leverage as it passed breakeven.