ORCL - MongoDB: Volatility Should Persist In The Medium Term

2024-07-04 07:35:56 ET

Summary

• MongoDB stock dropped post-FQ1 results despite double-digit revenue growth and beating estimates, but with lowered guidance for the full fiscal year.
• The stock outperformed tech-heavy Invesco QQQ Trust due to AI-related optimism, but challenges persist.
• MongoDB faces demand weakness, competition from hyperscalers, and risks from Gen AI advancements, leading to a bearish outlook.
• It could potentially benefit from AI, but this could take time to show in MongoDB’s numbers.
• In the meanwhile, it could face volatility given that its valuations show that the market is full of expectations.

MongoDB’s ( MDB ) stock dropped by more than 20% in the aftermath of the first quarter of fiscal year 2025 (FQ1) results, despite revenues increasing by 22% YoY and beating topline estimates. However, it lowered sales guidance for the fiscal year ending in January 2025 (FY-25), implying reduced growth, from 14% to 12%....

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