Expensify, Inc. (NASDAQ: EXFY)

Sector: Technology Industry: Software - Application CIK: 0001476840
Market Cap 122.94 Mn
P/B 0.91
P/E -7.89
P/S 0.85
ROIC (Qtr) -10.44
Div Yield % 0.00
Rev 1y % (Qtr) -0.97
Total Debt (Qtr) 5.93 Mn
Debt/Equity (Qtr) 0.04

About

Expensify, Inc. (EXFY) is a leading cloud-based expense management software platform operating within the financial technology industry. The company has established itself as a global leader in expense management, servicing over 15 million members and processing over 1.5 billion expense transactions as of December 31, 2023. Expensify's primary business activities focus on providing a comprehensive expense management platform that streamlines financial processes, automates expense tracking, and simplifies expense reporting for businesses. The platform...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 25.29M provides robust 4.27x coverage of total debt 5.93M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 61.45M provide 85.35x coverage of short-term debt 720000, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 172.21M provides 29.05x coverage of total debt 5.93M, indicating robust asset backing and low credit risk.
  • Operating cash flow of 25.29M provides exceptional 16.09x coverage of interest expenses 1.57M, showing strong debt service capability.
  • Robust free cash flow of 21.60M exceeds capital expenditure of 3.69M by 5.86x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 25.29M barely covers its investment activities of (3.69M), with a coverage ratio of -6.86, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (3.69M) provide weak support for R&D spending of 22.12M, which is -0.17x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of 25.29M shows concerning coverage of stock compensation expenses of 31.58M, with a 0.80 ratio indicating potential earnings quality issues.
  • Operating earnings of (11.28M) show weak coverage of depreciation charges of 8.71M, with a -1.30 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 21.60M represents just -96.01x of debt issuance (225000), suggesting concerning reliance on leverage rather than internal cash generation for growth.

Peer comparison

Companies in the Software - Application
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SAP Sap Se 288.31 Bn 34.60 6.72 10.73 Bn
2 CRM Salesforce, Inc. 248.32 Bn 34.38 6.16 11.14 Bn
3 SHOP Shopify Inc. 212.27 Bn 119.19 19.85 1.12 Bn
4 INTU Intuit Inc. 180.73 Bn 43.89 9.30 6.78 Bn
5 UBER Uber Technologies, Inc 178.38 Bn 10.72 3.60 12.19 Bn
6 NOW ServiceNow, Inc. 146.98 Bn 84.91 11.60 2.40 Bn
7 ADBE Adobe Inc. 144.48 Bn 20.77 6.23 6.64 Bn
8 ADP Automatic Data Processing Inc 108.20 Bn 26.16 5.18 9.77 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.37 2.65
EV to Cash from Ops. EV/CFO 2.71 13.37
EV to Debt EV to Debt 11.56 57.69
EV to EBIT EV/EBIT -6.08 19.12
EV to EBITDA EV/EBITDA -13.95 15.00
EV to Free Cash Flow [EV/FCF] EV/FCF 3.17 14.69
EV to Market Cap EV to Market Cap 0.56 -92.28
EV to Revenue EV/Rev 0.48 4.60
Price to Book Value [P/B] P/B 0.91 4.26
Price to Earnings [P/E] P/E -7.89 -136.90
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 -3.95
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 4.25
Dividend per Basic Share Div per Share (Qtr) 0.00 0.15
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.52
Interest Coverage Int. cover (Qtr) -7.17 -52.32
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 59.76 -259.78
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 56.88 9,763.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.61
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -130.94 -263.15
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -748.36 56.46
EBIT Growth (1y) % EBIT 1y % (Qtr) -258.28 -225.15
EBT Growth (1y) % EBT 1y % (Qtr) -51.60 -86.10
EPS Growth (1y) % EPS 1y % (Qtr) -5.88 123.84
FCF Growth (1y) % FCF 1y % (Qtr) 219.00 -36.82
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -2.36 95.08
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.77 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 1.38 3.75
Current Ratio Curr Ratio (Qtr) 3.44 8.16
Debt to Equity Ratio Debt/Equity (Qtr) 0.04 0.17
Interest Cover Ratio Int Coverage (Qtr) -7.17 -52.32
Times Interest Earned Times Interest Earned (Qtr) -7.17 -52.32
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -1.80 -100.06
EBIT Margin % EBIT Margin % (Qtr) -7.83 -164.24
EBT Margin % EBT Margin % (Qtr) -8.93 -116.94
Gross Margin % Gross Margin % (Qtr) 50.80 58.20
Net Profit Margin % Net Margin % (Qtr) -10.80 -121.65