SMWB - Semrush: Attractive SaaS Characteristics Justifies Current Valuation

2024-07-11 11:40:44 ET

Summary

• Strong covid-driven revenue growth of 37% CAGR19-23 is now coming down to +20% in 2024.
• Semrush is a leading player in an attractive market expected to grow with a CAGR21-30 of >18% which I expect to be roughly in line with its future revenue growth.
• Cohort analysis proves stable customer cohorts and the company's ability to execute on upselling initiatives.
• Quality has its price: Despite its full valuation, I rate Semrush a BUY due to its leading positioning and growth potential over the long term.

Investment Thesis

Semrush ( SEMR ) enjoys a market leading position in an attractively growing (18% CAGR p.a.) market supported by the overall digitization megatrend....

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