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HubSpot Inc HUBS

Morningstar Rating
$491.91 −4.62 (0.93%)
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Company Report

HubSpot Earnings: Strong New Customer Adds And Profitability Shine Within Good Results

Narrow-moat HubSpot has been on a roll, reporting good results over the last several quarters, and the third quarter was no exception. The company delivered revenue and profitability that appreciably bested our expectations, while fourth-quarter guidance was generally in line. New solutions with a focus on artificial intelligence are being released at a rapid pace, which we expect to support strong revenue growth over the next several years. After filtering results and guidance through our model, we are raising our fair value estimate to $505 per share, from $480. We see shares as slightly undervalued and continue to view HubSpot as well-positioned in the mid-market for marketing and sales automation software, with an expanding and powerful portfolio and a robust growth profile coupled with solid execution.

Price vs Fair Value

HUBS is trading at a 2% discount.
Price
$496.52
Fair Value
$996.00
Uncertainty
Very High
1-Star Price
$365.26
5-Star Price
$641.70
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

HubSpot has made a splash in the SMB market with its freemium model, easier implementation, and simple and feature-rich software.

Bears

Net dollar retention is low relative to other rapidly growing SaaS peers and even software more broadly. Given the SMB customer base, we do not see this easing over the next several years.

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News

Trading Information

Previous Close Price
$496.53
Day Range
$488.41507.96
52-Week Range
$265.72581.34
Bid/Ask
$491.46 / $491.91
Market Cap
$24.74 Bil
Volume/Avg
320,720 / 602,119

Key Statistics

Price/Earnings (Normalized)
94.77
Price/Sales
11.94
Dividend Yield
Dividend Yield (Forward)
Total Yield

Company Profile

HubSpot provides a cloud-based marketing, sales, and customer service software platform referred to as the growth platform. The applications are available ala carte or packaged together. HubSpot’s mission is to help companies grow better and has expanded from its initial focus on inbound marketing to embrace marketing, sales, and service more broadly. The company was founded in 2006, completed its initial public offering in 2014, and is headquartered in Cambridge, Massachusetts.
Sector
Technology
Industry
Software - Application
Stock Style Box
Mid Growth
Total Number of Employees
7,478

Competitors

Valuation

Metric
HUBS
CRM
MSFT
Price/Earnings (Normalized)
94.7729.3436.25
Price/Book Value
20.973.8412.76
Price/Sales
11.946.6812.96
Price/Cash Flow
75.5418.9429.22
Price/Earnings
HUBS
CRM
MSFT

Financial Strength

Metric
HUBS
CRM
MSFT
Quick Ratio
2.160.861.45
Current Ratio
2.351.041.66
Interest Coverage
−54.7216.6746.91
Quick Ratio
HUBS
CRM
MSFT

Profitability

Metric
HUBS
CRM
MSFT
Return on Assets (Normalized)
10.43%8.01%21.73%
Return on Equity (Normalized)
26.07%12.86%43.59%
Return on Invested Capital (Normalized)
12.96%10.70%32.22%
Return on Assets
HUBS
CRM
MSFT

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