Anaplan (PLAN) is a software provider in the Sales and Operations Planing Systems space. They just had a very good earnings report.……

I looked at them earlier in the year, and passed for these reasons:

  1. Their subscription revenue and was decreasing.

  2. Their billings were decreasing.

  3. Their free cash flow was getting worse. More negative.

  4. Their Net expansion rate had been decreasing.

I didn’t really understand their competitive advantage and didn’t look any further.

After this quarter, the business is looking much better and I am adding them to my watch list.

  1. Subscription revenue has risen the last 2 quarters, 45% this quarter.

  2. Billings has really accelerated, 57% this quarter: last 4 quarters 33->43->54->57

  3. Much improved Free cash flow (-5 M compared to -16 M the year before).

  4. Net expansion rate has stabilized at 123%.

I still don’t understand their competitive advantage, but the business is now heading in the right direction so I’m going to learn more about them.