monday.com (MNDY) Q1 Earnings Report Preview: What To Look For

Kayode Omotosho /
2022/05/16 3:47 am EDT

Project management software maker Monday.com (NASDAQ:MNDY) will be reporting results today before market open. Here's what to look for.

Last quarter monday.com reported revenues of $95.5 million, up 90.5% year on year, beating analyst revenue expectations by 8.82%. Despite the stock dropping on the results, it was still a very strong quarter for the company, with a very optimistic guidance for the next quarter and an exceptional revenue growth. The company added 180 enterprise customers paying more than $50,000 annually to a total of 793.

Is monday.com buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting monday.com's revenue to grow 71.7% year on year to $101.3 million, slowing down from the 84.6% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$1.01 per share.

monday.com Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time since going public on average by 11.2%.

Looking at monday.com's peers in the productivity software segment, some of them have already reported Q1 earnings results, giving us a hint of what we can expect. Atlassian delivered top-line growth of 30.2% year on year, beating analyst estimates by 5.2% and Jamf reported revenues up 33.3% year on year, exceeding estimates by 2.35%. Atlassian traded down 3.8% on the results, and Jamf was flat on the results. Read our full analysis of Atlassian's results here and Jamf's results here.

Triggered by the Federal Reserve's hawkish stance on interest rates, shares of technology companies have been facing sell-off in 2022 and software stocks have not been spared, with share price down on average 18.4% over the last month. monday.com is down 20.2% during the same time, and is heading into the earnings with analyst price target of $250.2, compared to share price of $107.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.