monday.com Ltd. (NASDAQ: MNDY)

Sector: Technology Industry: Software - Application CIK: 0001845338
Market Cap 3.82 Bn
P/B 3.06
P/E 32.18
P/S 3.10
ROIC (Qtr) -0.60
Div Yield % 0.00
Rev 1y % (Qtr) 24.59
Total Debt (Qtr) 168.77 Mn
Debt/Equity (Qtr) 0.14
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About

Monday.com Ltd., popularly known as MNDY, is a technology company that operates in the software industry, specifically in work operating systems and project management software. This company offers a wide range of products and services, including a Work Operating System (WOS), project management software, and custom solutions, all designed to streamline business operations, enhance collaboration, and boost productivity. Monday.com caters to a diverse clientele, ranging from small startups to large enterprises across various industries. The Work...

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Investment thesis

Bull case

  • Strong operating cash flow of 333.64M provides robust 1.98x coverage of total debt 168.77M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 1.50B provide 58.22x coverage of short-term debt 25.82M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 2.11B provides 12.48x coverage of total debt 168.77M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 309.90M exceeds capital expenditure of 23.74M by 13.05x, indicating strong organic growth funding capability.
  • Tangible assets of 2.11B provide exceptional 5.12x coverage of deferred revenue 411.62M, showing strong service capability backing.

Bear case

  • Operating cash flow of 333.64M barely covers its investment activities of (133.72M), with a coverage ratio of -2.50, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (133.72M) provide weak support for R&D spending of 320.80M, which is -0.42x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 333.64M provides insufficient coverage of deferred revenue obligations of 411.62M, which is 0.81x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of 333.64M shows concerning coverage of stock compensation expenses of 177.01M, with a 1.88 ratio indicating potential earnings quality issues.
  • Operating cash flow of 333.64M provides minimal -5.61x coverage of tax expenses of (59.42M), suggesting potential tax planning inefficiencies or unsustainable tax positions.

Concentration Risk Type Breakdown of Revenue (2024)

Concentration Risk Type Breakdown of Revenue (2024)

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 1.15 2.08
EV to Cash from Ops. EV/CFO 7.23 11.38
EV to Debt EV to Debt 14.30 47.67
EV to EBIT EV/EBIT -1,380.64 6.78
EV to EBITDA EV/EBITDA 200.16 7.15
EV to Free Cash Flow [EV/FCF] EV/FCF 7.79 14.44
EV to Market Cap EV to Market Cap 0.63 -8.88
EV to Revenue EV/Rev 1.96 4.04
Price to Book Value [P/B] P/B 3.06 3.65
Price to Earnings [P/E] P/E 32.18 -117.75
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 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) 0.03 -43.57
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -55.84 -222.46
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 6.49 281.53
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.78
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 82.29 -327.55
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 231.40 30.09
EBIT Growth (1y) % EBIT 1y % (Qtr) 91.69 -213.00
EBT Growth (1y) % EBT 1y % (Qtr) 72.10 -86.84
EPS Growth (1y) % EPS 1y % (Qtr) 255.38 108.58
FCF Growth (1y) % FCF 1y % (Qtr) 4.76 6.29
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 26.56 94.58
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.58 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 2.10 3.78
Current Ratio Curr Ratio (Qtr) 2.50 8.27
Debt to Equity Ratio Debt/Equity (Qtr) 0.14 0.14
Interest Cover Ratio Int Coverage (Qtr) 0.03 -43.57
Times Interest Earned Times Interest Earned (Qtr) 0.03 -43.57
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 1.00 -105.03
EBIT Margin % EBIT Margin % (Qtr) -0.14 -130.16
EBT Margin % EBT Margin % (Qtr) 4.81 -121.17
Gross Margin % Gross Margin % (Qtr) 89.20 58.37
Net Profit Margin % Net Margin % (Qtr) 9.60 -126.13