Category: Uncategorized (Page 6 of 10)

Okta (OKTA) Stock Q1 FY2021 Earnings Results Review

June 3, 2020 / poffringa

Okta released their Q1 (April end) FY2021 earnings report on May 28. They delivered a significant beat on both revenue and earnings for Q1 and slightly raised estimates for Q2 and remainder of the year. Management applied some conservatism to the forward estimates, in anticipation of possible customer spending slowdown in Q2 and Q3. Following the results, most analysts increased price targets and maintained buy ratings. Commentary on the earnings call was upbeat. In this post, I review Okta’s earnings results and the evolution of their platform offering. I also examine recent activity from competitors and the broader opportunity in the evolving identity space. As a refresher, please see my previous analysis of Okta for a full explanation of their products, addressable market and competitive positioning.

Datadog (DDOG) Stock Q1 2020 Earnings Results Review

May 28, 2020 / poffringa

Datadog released their Q1 2020 earnings report on May 11. The company delivered their typical beat and raise, exhibiting no noticeable slowdown from COVID-19. The market rewarded the stock the next day with a 24% jump, on top of a 47% run-up previously in 2020. Unlike other software companies impacted by COVID-19, Datadog kept annual guidance and even raised revenue targets by 5% over their prior estimate. Analysts and management were upbeat on the earnings call – price targets were raised across the board. In this post, I will review Datadog’s earnings results and then examine the broader observability space, as several competitors announced earnings recently as well.

Fastly (FSLY) Q1 2020 Earnings Results Review

May 19, 2020 / poffringa

Fastly released their Q1 2020 earnings report on May 6. The results were a blow-out. Q1 actuals were comfortably above estimates for revenue and profitability. Q2 projections and full year raise were even more impressive. At the midpoint, Q2 annualized revenue growth was increased over 20%. Much of the outperformance was provided by the COVID-19 situation, but management anticipates the tailwinds from higher usage across their product set to continue through the year. On top of this, the new Compute@Edge beta release is progressing nicely and should drive incremental revenue streams in 2021. The stock surged almost 46% the day after earnings, as the market digested the stellar results. All analysts raised their price targets. In this post, I will parse out the earnings results, give an update on the CEO transition, check in with comparisons to Cloudflare and then draw conclusions for the investment thesis going forward.

Alteryx (AYX) Q1 2020 Earnings Results Review

May 14, 2020 / poffringa

Alteryx released their Q1 2020 earnings report on May 6, 2020. Results were mixed – they beat Q1 estimates for revenue and were almost inline on EPS. However, the headline surprise came with a substantial reduction in Q2 revenue and EPS estimates as a result of a COVID-19 driven slowdown. The stock initially dropped by as much as 10% the next day, but gradually recovered to close down 2.9%. Following the results, most analysts lowered their price targets. Alteryx also made a major product announcement on May 11th and has recently posted some very interesting new job openings. There is a lot to unpack here and I will try to cover all the new activity, in addition to the earnings report. Then, we can look at what this means for the investment thesis going forward.

Twilio (TWLO) Q1 2020 Earnings Results Review

May 10, 2020 / poffringa

Twilio released their Q1 2020 earnings report on May 6. The results stunned the market – they beat Q1 estimates and raised projections for Q2 by a wide margin. Growth was across the board – benefitting from COVID-19 specific use cases and their broad platform offering, as companies flock towards digitizing customer communications. The market reacted the next day by driving TWLO stock up over 39% to close at nearly $171. All analysts raised their price targets significantly. Commentary on the earnings call was very positive. Let’s take a deeper look at the results, customer wins, overall market trends and then draw some conclusions for the investment thesis going forward.

Zendesk (ZEN) Q1 2020 Earnings Results Review

May 6, 2020 / poffringa

Zendesk released their earnings report for Q1 2020 on April 30, 2020. Results were mixed – they beat Q1 estimates, but lowered revenue projections for Q2 due to COVID-19 impact on customers. The market reacted the next day by pushing ZEN stock down 5.6%, although some of that drop has recovered since then. Most analysts lowered their price targets. Zendesk leadership also retracted prior FY 2020 guidance, until they have more clarity around the duration of the COVID-19 economic downturn. Let’s take a deeper look at the results and draw some conclusions for the investment thesis.

Okta (OKTA) Stock Analysis

May 1, 2020 / poffringa

Okta is the leading independent provider of identity services. While their roots have been in controlling employee access to enterprise applications, Okta has recently doubled their TAM by providing identity management for consumer apps. Almost every modern digital application requires its users to verify their identity. Facilitating this process has become a necessary software building block. Okta supports this capability with a suite of robust platform services, which developers can consume through well-documented APIs. Okta’s packaged software products are built on top of these platform services, driving a continuous feedback loop. Okta’s product offerings target an enormous addressable market, the combination of both workforce and customer identity. Strong secular trends in enterprise employee mobility, cloud migration and digital transformation are driving this market and Okta occupies the pole position. The company is led by two co-founders with deep SaaS domain experience. To help investors better understand the opportunity, I will dig into Okta’s technology underpinnings, financials, product portfolio, addressable market and competitive landscape. This will provide an investment framework which investors can use to monitor Okta’s progress going forward.

Docusign (DOCU) Stock Analysis

April 20, 2020 / poffringa

Docusign is a leading provider of agreement services. While most investors are familiar with their eSignature solution, they have recently expanded their product suite to address the full lifecycle of contract management. As digital agreements become a common step in enterprise workflows and online marketplaces, DocuSign is well positioned to meet the demand. For developers, they offer an open platform and broad set of APIs. Large customer additions have been strong, driving 39% revenue growth over the last year. In this post, I will dig into the company’s history, financials, product portfolio, addressable market and competitive landscape. While the stock has enjoyed a 35% gain year to date, for investors with a long term perspective, DOCU represents a solid choice.

Considering Platform Plays

April 12, 2020 / poffringa

Over the last couple of months, I have noticed several prominent software companies announcing new platform offerings. This goes beyond a marketing tactic, as most are backing the move with substantial new capabilities and tooling to add “programmability”. These extensions are meant to appeal to solution builders, in addition to their existing product users. While the companies will still offer packaged products, they are opening up their underlying software services for outside developers to build their own custom applications. The rationalization is an expectation that this will drive incremental revenue from usage fees, as developers launch brand new businesses or internal teams at enterprises tackle adjacent use cases. Also, some leading SaaS companies haven’t rolled out full platform offerings, but might benefit from it. In this post, I will examine what makes for a productive platform play, several recent examples of this trend and how it might apply to other point solution providers. The platform potential of a software company is an important consideration for investors. If executed successfully, it can substantially magnify the long term growth opportunity for a company’s stock.

Datadog (DDOG) Stock Analysis

April 6, 2020 / poffringa

Datadog is a leader in monitoring solutions for cloud-scale applications. They are experiencing significant growth in a large addressable market that is a core beneficiary of digital transformation initiatives. While competitive offerings have recently stepped up, Datadog still enjoys impressive customer expansion. Their product development velocity is breakneck, doubling the number of paid solutions in the last year. Looking forward, they have additional opportunities in adjacent markets. The company is led by two technical co-founders. I will dig into the company’s history, financials, product portfolio, addressable market and competitive landscape. This will set a foundation and investment framework which investors can use to monitor Datadog’s progress going forward.

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