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

Adam Hejl /
2023/05/15 3:29 am EDT

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

Last quarter monday.com reported revenues of $149.9 million, up 56.9% year on year, beating analyst revenue expectations by 5.85%. It was a strong "beat and raise" quarter for the company, with a full year revenue guidance beating analysts' expectations and a solid beat of Q4 analyst estimates across the board. The company added 151 enterprise customers paying more than $50,000 annually to a total of 1,474.

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 43.1% year on year to $155.3 million, slowing down from the 84% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.29 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 over the past two years on average by 8.03%.

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 23.6% year on year, beating analyst estimates by 1.52% and Everbridge reported revenues up 7.86% year on year, exceeding estimates by 1.7%. Atlassian traded down 10% on the results, Everbridge was up 3.5%. Read our full analysis of Atlassian's results here and Everbridge's results here.

There is still much uncertainty in the markets. The Federal Reserve's hawkish stance on rates, meant to tame inflation, remains a key market narrative. There is an added wrinkle now with troubles in the banking sector, triggered by Silicon Valley Bank's fairly sudden and surprising collapse. Given these, the question is whether higher rates (which dampen economic activity) and potentially less lending from the overall banking sector will trigger a recession. While some tech stocks have recovered year-to-date, most are still well off their 52-week highs. monday.com is up 0.39% over the last month, and is heading into the earnings with analyst price target of $176.5, compared to share price of $132.49.

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.