Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

Slack Technologies Inc / Equity Capital Markets

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Based on the 22.1x EV/Sales multiple, and applying our 2020 sales estimate of $953 million, this would imply an EV of $21 billion and a market cap of $21.9 billion and one year target price of $37 per share. Slack's shares have been traded privately this year at $21 to $28 per share. Our implied target price of $37 per share would be 51% higher than the mid-point ($24.50) of the privately traded valuation range.
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Slack's shares have been traded privately this year at $21 to $28 per share. At the high end of the private market valuation ($28 per share), this would imply market cap of nearly <a href="https://www.cnbc.com/2019/04/25/slack-valued-at-17-billion-on-secondary-market-ahead-of-public-debut.html" target="_blank">$16.7 billion. </a>
We forecast the company's sales to increase 63.7% YoY to $655.7 million in year ending January 2020 and rise 45.3% YoY to $952.7 million in year ending January 2021. We forecast the company to start generating positive operating profit starting year ending January 2023.


Based on the 22.1x EV/Sales multiple, and applying our 2020 sales estimate of $953 million, this would imply an EV of $21 billion and a market cap of $21.9 billion and one year target price of $37 per share. Slack's shares have been traded privately this year at $21 to $28 per share. Our implied target price of $37 per share would be 51% higher than the mid-point ($24.50) of the privately traded valuation range.

Slack's shares have been traded privately this year at $21 to $28 per share. At the high end of the private market valuation ($28 per share), this would imply market cap of nearly $16.7 billion. 
We forecast the company's sales to increase 63.7% YoY to $655.7 million in year ending January 2020 and rise 45.3% YoY to $952.7 million in year ending January 2021. We forecast the company to start generating positive operating profit starting year ending January 2023.

Slack Technologies ("The Email Killer") Valuation Analysis

<a href="https://www.smartkarma.com/entities/27993" target="_blank" data-smartkarma-citation="entities:27993:1">PagerDuty Inc (PD US)</a> is a US based software company which is ready to complete its IPO in the next several weeks. Founded in 2009, PagerDuty helps companies to respond quickly when their websites go down. PagerDuty's software helps companies to respond to items such as customer complaints and helps companies to spot problems. The company is known for capitalizing on its AI (Artificial Intelligence) models to quickly solve problems of why websites go down. The company has an excellent, diversified base of more than 10,000 customers in 90 countries including IBM, The World Bank, Airbnb, Netflix, GE, and Gap. One of the strong points of PagerDuty is the fact that it has gathered massive amounts of data from its more than 10,000 customers. The company also boasts a very high customer retention rate (139% net retention rate). A combination of the company's strong AI capability coupled with the increasing amounts of Big Data provide a strong competitive advantage for the company since its AI capability may improve and get smarter with additional Big Data and continuous problem solving of why websites go down.PagerDuty was most recently valued at $1.3 billion in September 2018 in a private market valuation (led by T.Rowe Price Group investing $90 million in the company), representing 16x the company's annual revenue of $79.6 million as of 12 months ending January 2018.

PagerDuty Inc (PD US) is a US based software company which is ready to complete its IPO in the next several weeks. Founded in 2009, PagerDuty helps companies to respond quickly when their websites go down. PagerDuty's software helps companies to respond to items such as customer complaints and helps companies to spot problems. The company is known for capitalizing on its AI (Artificial Intelligence) models to quickly solve problems of why websites go down. The company has an excellent, diversified base of more than 10,000 customers in 90 countries including IBM, The World Bank, Airbnb, Netflix, GE, and Gap. One of the strong points of PagerDuty is the fact that it has gathered massive amounts of data from its more than 10,000 customers. The company also boasts a very high customer retention rate (139% net retention rate). A combination of the company's strong AI capability coupled with the increasing amounts of Big Data provide a strong competitive advantage for the company since its AI capability may improve and get smarter with additional Big Data and continuous problem solving of why websites go down.PagerDuty was most recently valued at $1.3 billion in September 2018 in a private market valuation (led by T.Rowe Price Group investing $90 million in the company), representing 16x the company's annual revenue of $79.6 million as of 12 months ending January 2018. 

United States

Pagerduty, Inc. provides wireless application solutions. The Company offers on call management, event intelligence, analytics, and digital operations, as well as equipment. Pagerduty serves customers worldwide.

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PagerDuty Inc (PD US)

Slack Technologies ("The Email Killer") Valuation Analysis

Based on the 22.1x EV/Sales multiple, and applying our 2020 sales estimate of $953 million, this would imply an EV of $21 billion and a market cap...

Douglas Kim

PagerDuty IPO Preview

PagerDuty Inc (PD US) is a US based software company which is ready to complete its IPO in the next several weeks. Founded in 2009, PagerDuty helps...

Douglas Kim

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