Are you tonight? :). https://m.youtube.com/watch?v=WJZY__j0Tyk
Sorry to clog up the board but I sure wonder what you think of PVTL.
Lucky Dog
4 Likes
Pivotal was already the smallest of my actual positions so I just sold a tiny bit but then decided to wait and see what Bert thought. I think that management’s surprise, that a number of people got annoyed with, may have been because they outdid everything they predicted, and never expected a big sell-off. There’s also their definition of a “customer” which isn’t until there is $50,000 of Revenue in a quarter (not Billing), and since they start small with huge customers and build from there, they could have quite a few more new customers that they aren’t counting yet. Even if they signed up a big company with a 3-yr contract, but it was in the 3rd month of the quarter, they surely wouldn’t have recognized %50,000 of revenue yet. So counting customers has pitfalls. So I’m waiting to let the dust settle. 93% margins and up 50% for the subscription part of the business will hold me while the dust settles.
Saul
44 Likes
went from 6.7% to smallest position… i’ll hate the next 2 weeks of wait to find out how 
7 Likes
I’d also love to hear if Steppenwulf has any thoughts on the quarter?
He has been great source of information on PVTL this year, so I’m curious what he thinks about the quarterly results and the company’s comments
5 Likes
MK, you are over interpreting. It was about 6.7% before today too. By smallest of my actual positions I wasn’t counting the little try out positions. I misspoke though as New Relic was a half a point lower.
1 Like
I think this is still a small company whose customers obviously love the product (150% net expansion rate) who is just starting to focus on building out their customers. They say the Fourth quarter is their best quarter. If software is going to eat the world who better to help people with their software build out?
Rob Mee
The increased productivity our customers achieve is impressive. We’ve done a deep dive with a cohort of our largest customers, and, on average, they release new software over 60% faster, are able to spend 35% more time writing code, and spend 90% less time provisioning new environments.
Time spent on common operational tasks, like operating system patching, is also reduced by over 90%. And, by reducing the OS patching burden, we found that these clients are much more likely to quickly apply security remediations.
That statement is what caught my eye.
Andy
20 Likes
Saul,
Thanks for clearing that up. As soon as i hit “submit message” i realized this might have happened and you might not consider wix and payc as “actual” positions.
Thanks again, this board is the best thing happened to me in my investment career
Mk
2 Likes
Saul,
Thank you so much for sharing your thoughts.
Read Bert’s article re PVTL. I got that certain metrics are not the best way to assess real potential/performance, ie. billings and even customer counts due to seasonality, when customers are signed on etc. which leads to lumpiness of the buz.
Is RPO an attempt to measure bookings/billings though? CFO says at CC that they might share that data at some point.
Bert says that “Percentage growth is not declining and the company’s competitive position hasn’t deteriorated.” I am perplexed. Here is Q1 to Q4 subscription rev #s.
2018 53/65/66/75
2019 90/98/99/104 (using the high end of guidance for 2H)
Growth Rate from Q1 to Q4: 69%, 51%, 49%, 39%
Growth on FY basis. 2017 58%, 2018 73% and 2019 51%
So I see a decelerating growth at this point. Whether the management has sand bagged the guidance or they are not maintaining their competitiveness probably will take some more quarters to find out.
And, to get around the lumpiness nature of the business… when the current quarter subscription rev growth is not as glorious as previous quarter, but management is “pleased”, would not we see some evidence in deferred rev or RPO even though they are not perfect yardsticks?
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What is the link to subscribe to Bert’s newsletter? Thanks.
Here 'tis. An excellent resource. Worth far more than it costs.
Vivienne
3 Likes
Bert says that Percentage growth is not declining…" I am perplexed.
Hi Hermione, I am too. I think that perhaps Bert was a bit overly enthusiastic there, and the truth is somewhere between his enthusiasm and the gloom and doomers. The issue for us is whether expectations (and price) are now so low that even a normal good quarter, not a blow-out one, will cause a blow-out stock price reaction. Hard to say whether to count on that, but it’s possible. I haven’t yet made up my mind entirely, although I do have a lot of respect for Bert’s opinions. (With the fall, my Pivotal is down to about a 4.0% position so my decision isn’t urgent).
Saul
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What is the link to subscribe to Bert’s newsletter? Thanks.
This should do it: https://www.tickertarget.com
2 Likes