Stock Market Nerd – Earnings Round-up – Zscaler ($ZS); Okta ($OKTA); UiPath ($PATH); Dell ($DELL); MongoDB ($MDB) – June 01, 2024
Plus/Max subs can expect a full review of Zscaler’s report & MongoDB’s report at some point early next week along with coverage of Uber, Airbnb and Mastercard investor conferences. I simply ran out of hours in the day to thoughtfully review these two prints. Zscaler looked excellent; MongoDB’s guide was underwhelming. Stay tuned for a lot more detail in the near future.
Zscaler ($ZS)
Results:
- Beat revenue estimates by 3.2% & beat guidance by 3.4%. Its 46.3% 3-year revenue compounded annual growth rate (CAGR) compares to 49.5% Q/Q & 51.6% 2 quarters ago.
- Beat EBIT estimates by 22% & beat guidance by 23%.
- Beat $0.65 EPS estimates & beat identical guidance by $0.23 each.
- Beat FCF estimate by 58%.
Source: Brad Freeman – SEC Filings, Company Presentations, and Company Press Releases
Fourth Quarter Guidance & Valuation:
- Slightly beat Q4 revenue estimates.
- Beat Q4 EBIT estimates by 1.4%.
- Beat $0.67 EPS estimates by $0.02.
Zscaler trades for 56x this fiscal year’s earnings with earnings expected to grow by 70% Y/Y this year and 8% Y/Y next year.
Balance Sheet:
- $2.25B in cash & equivalents.
- $1.14B in senior notes.
- No traditional debt.
- Diluted share count rose 6% Y/Y; basic share count rose by 3.4% Y/Y.
Okta ($OKTA)
Results:
- Beat revenue estimates by 2.1% & beat guidance by 2.2%. Its 35.0% 3-year revenue CAGR compares to 37.1% Q/Q & 40.6% 2 quarters ago.
- Beat cRPO growth guide by 1.7%.
- Beat FCF guide by 42%.
- Beat EBIT estimate by 21.3% & beat guide by 22.0%.
- Beat $0.55 EPS estimate & beat identical guidance by $0.10 each.
Source: Brad Freeman – SEC Filings, Company Presentations, and Company Press Releases
Annual Guidance & Valuation:
- Raised revenue guide by 1.4%, which beat by 1.1%.
- Raised EBIT guide by 7.6%, which beat by 6.9%.
- Raised FCF guide by 6.3%, which beat by 6.0%.
- Raised $2.27 EPS guide by $0.10, which beat by $0.11.
Trades for 39x forward earnings. Earnings are expected to grow by 50% Y/Y this year & 19% Y/Y next year.
Balance Sheet:
- $2.3B in cash & equivalents.
- $1.2B in convertible notes; no debt.
- Share count +3.8% Y/Y.
UiPath ($PATH)
Results:
- Beat revenue estimate by 0.6% & beat guide by 0.8%.
- Slightly missed ARR guidance.
- Missed EBIT estimate & missed same guide by 8.4% each.
- Beat 85.5% GPM estimate by 50 bps.
- The company’s old founder/CEO is stepping back in to replace the current CEO.
- 118% dollar-based net revenue retention vs. 119% Q/Q & 122% Y/Y.
Source: Brad Freeman – SEC Filings, Company Presentations, and Company Press Releases
Annual Guidance:
- Lowered annual revenue guide by 5.3%, which missed by 5.3%.
- Lowered annual ARR guide by 3.8%.
- Cut annual $245 million EBIT guide in half, which sharply missed estimates.
Trades for ~40x EPS with -32% Y/Y EPS growth expected & 25% Y/Y EPS growth next year expected.
Balance Sheet:
- ~$2B in cash & equivalents.
- No debt.
- Share count rose by 2.1% Y/Y.
Dell ($DELL)
Results:
- Beat revenue estimates by 2.5% & beat guide by 2.5%.
- Beat $1.29 EPS estimate by $0.03 & beat lower guidance by $0.17.
- Slightly missed EBIT estimates; missed 22.8% GPM estimate by 120 bps.
Source: Brad Freeman – SEC Filings, Company Presentations, and Company Press Releases
Annual Guidance & Valuation:
- Raised $93 billion annual revenue guide by 2.7%, which beat estimates by 1.1%.
- Raised $7.50 annual EPS guide by $0.15, which missed by $0.19. There was some concern from analysts about rapid AI server growth not leading to any EBIT growth at all. The Dell team called deals for these servers “competitive.”
Balance Sheet:
- $5.8B in cash; $4.7B in short term financing receivables.
- $1.3B in long term investments.
- $25.5B in total debt.
- Stock comp fell Y/Y to less than 1% of revenue.
MongoDB ($MDB)
Results:
- Beat revenue estimate by 2.4% & beat guide by 2.9%. 25.7% 2-year revenue CAGR vs. 38.1% Q/Q and 46% 2 quarters ago.
- Beat $25M EBIT estimate by $8M & Beat guide by $9M.
- Beat $0.37 EPS estimate & beat same guide by $0.14 each.
- Beat FCF estimate by 74%.
Source: Brad Freeman – SEC Filings, Company Presentations, and Company Press Releases
Annual Guidance & Valuation:
- Lowered annual revenue guide by 1.3%, which missed by 2.6%.
- Lowered annual EBIT guide by 9.3%, which missed by 11.7%.
- Lowered $2.38 EPS guide by $0.16, which missed by $0.21.
- Next Q missed across the board.
Balance Sheet:
- $2.1B in cash & equivalents.
- $1.14B in senior notes.
- Diluted share count rose by 4% Y/Y.
