2024-07-12 13:16:52 ET
Summary
- Freshworks stock has declined sharply year to date, creating a buying opportunity.
- Its revenue growth has remained consistently around 20% y/y over the past few quarters.
- The company's slight slippage in net revenue retention rates, owing to SMB weakness, has been echoed throughout the software sector.
- The company has $1.2 billion of net cash, unencumbered of debt, which it's starting to put to use by engaging in M&A.
- The stock trades at a very cheap ~3.7x current-year revenue multiple.
In my opinion, value-oriented growth stocks are in short supply these days as the stock market continues to rally to all-time highs, fueled by AI hopes as well as enthusiasm over the potential of coming rate cuts. But all-time highs are also a great time to be more cautious, and I've continued to rotate more of my portfolio away from sharp winners and into rebound plays, particularly "growth at a reasonable price" stocks....
Read the full article on Seeking Alpha
For further details see:
Freshworks: Diversified, Growing Software Portfolio Trading At An Attractive Price