DDOG - The Rule Of 40 For SaaS Companies - 'R40 Scorecard' Performance Dec '20/Jan '21 - High Scoring Stocks Continue To Outperform
- In 2020, I published a series of articles on software as a service (SaaS) firms and their stocks, and especially those that pass the Rule of 40.
- The Rule of 40 balances sales growth and profitability in hyper-growth SaaS companies, and we have found as a group these stocks have outperformed the broad market and software indices.
- In the last piece, I introduced the “Rule of 40 Scorecard”, a rating system I developed to potentially find those Rule of 40 stocks primed for outperformance.
- In this piece, we review the performance of the “R40 Scorecard” stocks since mid-December.
- While this is a relatively short period, we are seeing some notable differences in performance based on valuation and size from the historical averages.
For further details see:
The Rule Of 40 For SaaS Companies - 'R40 Scorecard' Performance, Dec '20/Jan '21 - High Scoring Stocks Continue To Outperform