monday.com Ltd. (NASDAQ: MNDY)

Sector: Technology Industry: Software - Application CIK: 0001845338
Market Cap 7.52 Bn
P/B 5.94
P/E 115.65
P/S 6.45
ROIC (Qtr) 0.39
Div Yield % 0.00
Rev 1y % (Qtr) 26.24
Total Debt (Qtr) 119.27 Mn
Debt/Equity (Qtr) 0.09

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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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 350.66M provides robust 2.94x coverage of total debt 119.27M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 1.53B provide 56.10x coverage of short-term debt 27.22M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 2.06B provides 17.26x coverage of total debt 119.27M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 330.45M exceeds capital expenditure of 20.21M by 16.35x, indicating strong organic growth funding capability.
  • Tangible assets of 2.06B provide exceptional 5.04x coverage of deferred revenue 408.41M, showing strong service capability backing.

Bear case

  • Operating cash flow of 350.66M barely covers its investment activities of (185.79M), with a coverage ratio of -1.89, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (185.79M) provide weak support for R&D spending of 298.21M, which is -0.62x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 350.66M provides insufficient coverage of deferred revenue obligations of 408.41M, which is 0.86x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of 350.66M shows concerning coverage of stock compensation expenses of 168.13M, with a 2.09 ratio indicating potential earnings quality issues.
  • Operating earnings of 5.46M show weak coverage of depreciation charges of 13.32M, with a 0.41 ratio indicating high capital intensity and potential reinvestment needs.

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 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 2.94 2.65
EV to Cash from Ops. EV/CFO 17.28 13.37
EV to Debt EV to Debt 50.80 57.69
EV to EBIT EV/EBIT 1,109.14 19.12
EV to EBITDA EV/EBITDA 322.50 15.00
EV to Free Cash Flow [EV/FCF] EV/FCF 18.34 14.69
EV to Market Cap EV to Market Cap 0.81 -92.28
EV to Revenue EV/Rev 5.20 4.60
Price to Book Value [P/B] P/B 5.94 4.26
Price to Earnings [P/E] P/E 115.65 -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) -0.09 -52.32
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -41.37 -259.78
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 14.22 9,763.58
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.61
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 118.56 -263.15
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 191.38 56.46
EBIT Growth (1y) % EBIT 1y % (Qtr) 117.19 -225.15
EBT Growth (1y) % EBT 1y % (Qtr) 177.62 -86.10
EPS Growth (1y) % EPS 1y % (Qtr) 190.91 123.84
FCF Growth (1y) % FCF 1y % (Qtr) 18.63 -36.82
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 28.22 95.08
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.57 0.58
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 2.19 3.75
Current Ratio Curr Ratio (Qtr) 2.67 8.16
Debt to Equity Ratio Debt/Equity (Qtr) 0.09 0.17
Interest Cover Ratio Int Coverage (Qtr) -0.09 -52.32
Times Interest Earned Times Interest Earned (Qtr) -0.09 -52.32
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 1.60 -100.06
EBIT Margin % EBIT Margin % (Qtr) 0.47 -164.24
EBT Margin % EBT Margin % (Qtr) 5.65 -116.94
Gross Margin % Gross Margin % (Qtr) 89.20 58.20
Net Profit Margin % Net Margin % (Qtr) 5.60 -121.65