Lightspeed Commerce Inc. (NYSE: LSPD)

Sector: Technology Industry: Software - Application CIK: 0001823306
Market Cap 1.36 Bn
P/B 0.91
P/E -1.97
P/S 1.15
ROIC (Qtr) -46.80
Div Yield % 0.00
Rev 1y % (Qtr) 11.50
Total Debt (Qtr) 20.21 Mn
Debt/Equity (Qtr) 0.01
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About

Investment thesis

Bull case

  • Strong operating cash flow of 56.90M provides robust 2.82x coverage of total debt 20.21M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 479M provide 88.57x coverage of short-term debt 5.41M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 776.44M provides 38.42x coverage of total debt 20.21M, indicating robust asset backing and low credit risk.
  • Tangible assets of 776.44M provide exceptional 11.13x coverage of deferred revenue 69.76M, showing strong service capability backing.
  • Tangible assets of 776.44M provide robust 11.05x coverage of other current liabilities 70.25M, indicating strong asset backing.

Bear case

  • Operating cash flow of 56.90M barely covers its investment activities of (25.55M), with a coverage ratio of -2.23, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (25.55M) provide weak support for R&D spending of 128.50M, which is -0.20x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 56.90M provides insufficient coverage of deferred revenue obligations of 69.76M, which is 0.82x, raising concerns about future service delivery capabilities.
  • High receivables of 40.13M relative to inventory of 12.09M (3.32 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • The company's operating cash flow of 56.90M shows concerning coverage of stock compensation expenses of 58.28M, with a 0.98 ratio indicating potential earnings quality issues.

Peer comparison

Companies in the Software - Application
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SAP Sap Se 235.43 Bn 27.31 5.44 9.50 Bn
2 SHOP Shopify Inc. 147.12 Bn 119.52 12.73 0.19 Bn
3 UBER Uber Technologies, Inc 147.10 Bn 14.63 2.83 12.08 Bn
4 CRM Salesforce, Inc. 122.20 Bn 594.48 15.45 11.14 Bn
5 INTU Intuit Inc. 113.93 Bn 178.01 32.63 6.78 Bn
6 ADBE Adobe Inc. 111.00 Bn 15.57 4.67 6.65 Bn
7 NOW ServiceNow, Inc. 109.54 Bn 62.67 8.25 2.40 Bn
8 ADP Automatic Data Processing Inc 86.44 Bn 20.41 4.07 4.37 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.55 2.08
EV to Cash from Ops. EV/CFO 16.13 11.38
EV to Debt EV to Debt 45.40 47.67
EV to EBIT EV/EBIT -1.32 6.78
EV to EBITDA EV/EBITDA -1.63 7.15
EV to Free Cash Flow [EV/FCF] EV/FCF 131.74 14.44
EV to Market Cap EV to Market Cap 0.67 -8.88
EV to Revenue EV/Rev 0.77 4.04
Price to Book Value [P/B] P/B 0.91 3.65
Price to Earnings [P/E] P/E -1.97 -117.75
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -4.05
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 4.38
Dividend per Basic Share Div per Share (Qtr) 0.00 0.15
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.48
Interest Coverage Int. cover (Qtr) 56.79 -43.57
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -122.95 -222.46
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -27.60 281.53
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.78
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -329.12 -327.55
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -1,000.98 30.09
EBIT Growth (1y) % EBIT 1y % (Qtr) -342.91 -213.00
EBT Growth (1y) % EBT 1y % (Qtr) -476.78 -86.84
EPS Growth (1y) % EPS 1y % (Qtr) -477.50 108.58
FCF Growth (1y) % FCF 1y % (Qtr) 109.44 6.29
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 16.34 94.58
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.71 0.58
Cash Payout Ratio Cash Payout Ratio 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 3.07 3.78
Current Ratio Curr Ratio (Qtr) 4.52 8.27
Debt to Equity Ratio Debt/Equity (Qtr) 0.01 0.14
Interest Cover Ratio Int Coverage (Qtr) 56.79 -43.57
Times Interest Earned Times Interest Earned (Qtr) 56.79 -43.57
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -47.00 -105.03
EBIT Margin % EBIT Margin % (Qtr) -58.54 -130.16
EBT Margin % EBT Margin % (Qtr) -57.51 -121.17
Gross Margin % Gross Margin % (Qtr) 42.80 58.37
Net Profit Margin % Net Margin % (Qtr) -58.10 -126.13