NCNO - nCino Remains Drastically Overvalued Despite Stellar Results

2024-03-27 10:00:26 ET

Summary

• nCino's financial results for Q4 of fiscal year 2024 showed revenue growth and profits that exceeded expectations.
• The company's subscription revenue has been steadily increasing, but even those high margins aren't improving things enough.
• While nCino has seen growth in the number of customers and major customers, the stock remains overvalued and carries the risk of underperformance.

After the market closed on March 26th, the management team at nCino ( NCNO ) announced financial results covering the final quarter of the company's 2024 fiscal year. Shares of the business spiked, trading up around 14.4% the last I looked, after management revealed revenue that only narrowly missed analysts' expectations but profits that comfortably exceeded forecasts. Add on top of this guidance that calls for continued bottom line improvement on the back of strong sales for the 2025 fiscal year, and I can understand the market's optimism about this particular play....

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