Every week I’ll provide updates on the latest trends in SaaS valuations, earnings announcements, and highlight any noteworthy news. Follow along to stay up to date! Highlight of the Week - More Earnings! This week was a nice dose of reality for many SaaS names. Multiples have expanded so much recently that the earnings report beats required to justify these multiples were impossible to hit. Even Shopify who beat revenue estimates by nearly 40% only saw their stock go up ~5%. This shows you the types of revenue beats that are already baked into current prices. Datadog, Fastly and Twilio all delivered stellar quarters of growth (and beat consensus estimates by a wide margin). Alas, it wasn’t enough of a beat and each stock dropped. (We’ll see what happens when these stocks trade Friday, I’m writing this late Thursday night and only have after hours data to go off of). Also - you’ll see nearly every company beat their consensus estimates. However, as I’ve written before, I believe these estimates were way too low, everyone knew that, and the beats we’re seeing were already priced in. So it shouldn’t come as a surprise to see Twilio beat by such a wide margin, yet still trade down.
Clouded Judgement 8.7.20
Clouded Judgement 8.7.20
Clouded Judgement 8.7.20
Every week I’ll provide updates on the latest trends in SaaS valuations, earnings announcements, and highlight any noteworthy news. Follow along to stay up to date! Highlight of the Week - More Earnings! This week was a nice dose of reality for many SaaS names. Multiples have expanded so much recently that the earnings report beats required to justify these multiples were impossible to hit. Even Shopify who beat revenue estimates by nearly 40% only saw their stock go up ~5%. This shows you the types of revenue beats that are already baked into current prices. Datadog, Fastly and Twilio all delivered stellar quarters of growth (and beat consensus estimates by a wide margin). Alas, it wasn’t enough of a beat and each stock dropped. (We’ll see what happens when these stocks trade Friday, I’m writing this late Thursday night and only have after hours data to go off of). Also - you’ll see nearly every company beat their consensus estimates. However, as I’ve written before, I believe these estimates were way too low, everyone knew that, and the beats we’re seeing were already priced in. So it shouldn’t come as a surprise to see Twilio beat by such a wide margin, yet still trade down.