Upwork, Inc (NASDAQ: UPWK)

Sector: Communication Services Industry: Internet Content & Information CIK: 0001627475
Market Cap 1.69 Bn
P/B 2.69
P/E 14.67
P/S 2.15
ROIC (Qtr) 5.94
Div Yield % 0.00
Rev 1y % (Qtr) 3.62
Total Debt (Qtr) 369.48 Mn
Debt/Equity (Qtr) 0.59
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About

Upwork, Inc., a leading online platform with a market capitalization of over $4 billion, operates in the staffing and human resources industry. The company connects businesses with independent talent from around the world, and it is the largest work marketplace globally, measured by gross services volume (GSV). Upwork's mission is to create economic opportunities that enable people to have better lives. Upwork's business model is built around its work marketplace, which provides a platform for clients to post projects and receive bids from a pool...

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Investment thesis

Bull case

  • Strong operating cash flow of 248.26M provides robust 0.67x coverage of total debt 369.48M, indicating excellent debt servicing capability and financial flexibility.
  • Strong tangible asset base of 1.11B provides 3.01x coverage of total debt 369.48M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 223.12M exceeds capital expenditure of 25.14M by 8.88x, indicating strong organic growth funding capability.
  • Tangible assets of 1.11B provide exceptional 143.36x coverage of deferred revenue 7.76M, showing strong service capability backing.
  • Short-term investments of 378.43M provide solid 1.34x coverage of other current liabilities 282.54M, indicating strong liquidity.

Bear case

  • Operating cash flow of 248.26M barely covers its investment activities of (136.94M), with a coverage ratio of -1.81, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (136.94M) provide weak support for R&D spending of 185.54M, which is -0.74x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 294.36M provide limited coverage of acquisition spending of (58.41M), which is -5.04x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of 248.26M shows concerning coverage of stock compensation expenses of 65.39M, with a 3.80 ratio indicating potential earnings quality issues.
  • Short-term investments of 378.43M represent 1.26x of working capital 300.67M, suggesting potentially excessive financial asset allocation versus operational needs.

Contract with Customer, Sales Channel Breakdown of Revenue (2025)

Contract with Customer, Sales Channel Breakdown of Revenue (2025)

Peer comparison

Companies in the Internet Content & Information
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GOOGL Alphabet Inc. 3,658.84 Bn 27.68 9.08 59.29 Bn
2 META Meta Platforms, Inc. 1,611.77 Bn 26.66 8.02 83.90 Bn
3 SPOT Spotify Technology S.A. 95.06 Bn 36.53 4.70 2.22 Bn
4 BIDU Baidu, Inc. 53.09 Bn 42.00 2.90 13.66 Bn
5 NBIS Nebius Group N.V. 27.43 Bn 269.75 51.78 4.89 Bn
6 RDDT Reddit, Inc. 25.97 Bn 49.02 11.79 0.02 Bn
7 TME Tencent Music Entertainment Group 23.51 Bn 15.03 5.28 0.54 Bn
8 BILI Bilibili Inc. 12.86 Bn 118.92 3.08 1.36 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.39 0.89
EV to Cash from Ops. EV/CFO 7.26 -2.77
EV to Debt EV to Debt 4.88 30.99
EV to EBIT EV/EBIT 11.76 2.55
EV to EBITDA EV/EBITDA 11.57 4.60
EV to Free Cash Flow [EV/FCF] EV/FCF 8.07 15.68
EV to Market Cap EV to Market Cap 1.06 1.23
EV to Revenue EV/Rev 2.29 63.03
Price to Book Value [P/B] P/B 2.69 1.29
Price to Earnings [P/E] P/E 14.67 17.11
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.34
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -8.66
Dividend per Basic Share Div per Share (Qtr) 0.00 0.31
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 2.48
Interest Coverage Int. cover (Qtr) 0.00 -209.50
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -74.04 -31.77
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -3.73 187.77
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 -0.48
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -46.46 -1.13
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 87.99 -497.28
EBIT Growth (1y) % EBIT 1y % (Qtr) 69.39 20.22
EBT Growth (1y) % EBT 1y % (Qtr) 69.39 -38.13
EPS Growth (1y) % EPS 1y % (Qtr) -45.96 -32.36
FCF Growth (1y) % FCF 1y % (Qtr) 60.38 25.84
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 2.99 22.57
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.61 0.73
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.02
Cash Ratio Cash Ratio (Qtr) 0.45 1.45
Current Ratio Curr Ratio (Qtr) 1.46 3.29
Debt to Equity Ratio Debt/Equity (Qtr) 0.59 -0.34
Interest Cover Ratio Int Coverage (Qtr) 0.00 -209.50
Times Interest Earned Times Interest Earned (Qtr) 0.00 -209.50
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 22.80 -4,353.96
EBIT Margin % EBIT Margin % (Qtr) 19.44 -4,865.94
EBT Margin % EBT Margin % (Qtr) 19.44 -5,084.75
Gross Margin % Gross Margin % (Qtr) 77.80 58.51
Net Profit Margin % Net Margin % (Qtr) 14.70 -5,086.49