Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Equity Capital Markets

Sailpoint Technologies Holdings / Equity Capital Markets

<ul>
<li>SailPoint, a founder-led provider of identity security for the modern enterprise, aims to raise up to $1B to pay off debt.</li>
<li>The company ended last quarter at $813M of implied ARR and I see a clear path to $1B+ ARR in FY26 ended Jan 30, 2026.</li>
<li>I believe SailPoint may consider IPO at valuation above take-private transaction of ~$6.9B in 2022. The company is expected to go public in February.</li>
</ul>


SailPoint, a founder-led provider of identity security for the modern enterprise, aims to raise up to $1B to pay off debt.
The company ended last quarter at $813M of implied ARR and I see a clear path to $1B+ ARR in FY26 ended Jan 30, 2026.
I believe SailPoint may consider IPO at valuation above take-private transaction of ~$6.9B in 2022. The company is expected to go public in February.


SailPoint IPO Valuation Analysis: Paying Debt With IPO Proceeds and $1B+ ARR in FY26

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>ServiceNow's second quarter of 2024 financial results indicate strong operational and financial momentum, with notable increases in important metrics despite a backdrop of an internal investigation and leadership changes.</li><li>The management presented a robust narrative of growth, leveraging its GenAI strategy, which contributed significantly to their overall performance.</li><li>The company reported a 23% year-over-year growth in subscription revenue at constant currency, surpassing their own guidance.</li></ul>

ServiceNow's second quarter of 2024 financial results indicate strong operational and financial momentum, with notable increases in important metrics despite a backdrop of an internal investigation and leadership changes.The management presented a robust narrative of growth, leveraging its GenAI strategy, which contributed significantly to their overall performance.The company reported a 23% year-over-year growth in subscription revenue at constant currency, surpassing their own guidance.

ServiceNow Inc.: Expanding Market Reach Through Partnerships and Cloud Solutions & Other Major Drivers

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<ul><li>US internet and software companies delivered mixed performances in 1Q24 in terms of revenue growth: advertising and cloud services revenue growth saw a reacceleration trend, while SaaS services revenue growth edged down slightly. However, the optimization in labour cost, increase in economies of scale and operating efficiency improvement continue to drive YoY margin expansion, which looks likely to sustain in 2Q24, in our view, but will face higher comps in 2H24.</li><li>AI-related monetization and profitability expansion remain the key investment themes for US internet and software stocks, while the sectors’ stock performance reacts positively to interest rate cuts , albeit the expectation might have been partly reflected in price.</li><li>Our stock picks are Microsoft (MSFT US; BUY; well positioned to ride on the tide of rapid development of Gen AI and related monetization), Amazon (AMZN US; BUY; solid margin expansion could exceed market expectation), and ServiceNow (NOW US; BUY; steady current remaining performance obligations (cRPO) growth and profitability expansion likely to sustain).</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

US internet and software companies delivered mixed performances in 1Q24 in terms of revenue growth: advertising and cloud services revenue growth saw a reacceleration trend, while SaaS services revenue growth edged down slightly. However, the optimization in labour cost, increase in economies of scale and operating efficiency improvement continue to drive YoY margin expansion, which looks likely to sustain in 2Q24, in our view, but will face higher comps in 2H24.AI-related monetization and profitability expansion remain the key investment themes for US internet and software stocks, while the sectors’ stock performance reacts positively to interest rate cuts , albeit the expectation might have been partly reflected in price.Our stock picks are Microsoft (MSFT US; BUY; well positioned to ride on the tide of rapid development of Gen AI and related monetization), Amazon (AMZN US; BUY; solid margin expansion could exceed market expectation), and ServiceNow (NOW US; BUY; steady current remaining performance obligations (cRPO) growth and profitability expansion likely to sustain).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Internet - AI and Margin Expansion Still Key Themes

<ul><li>ServiceNow had a strong first quarter in 2024, outperforming guidance on all top-line and profitability metrics.</li><li>The company’s subscription revenue grew by 24.5% year-over-year on a constant currency basis.</li><li>Current remaining performance obligations (CRPO) rose by 21% year over-year in constant currency, which was above the company’s guidance.</li></ul>

ServiceNow had a strong first quarter in 2024, outperforming guidance on all top-line and profitability metrics.The company’s subscription revenue grew by 24.5% year-over-year on a constant currency basis.Current remaining performance obligations (CRPO) rose by 21% year over-year in constant currency, which was above the company’s guidance.

ServiceNow Inc: How Will The Adoption of GenAI Technology Impact Their Future Revenues & Profitability? - Major Drivers

<ul><li>ServiceNow announced 1Q24 results: total revenue increased by 24% YoY to US$2.60bn, in line with consensus estimate of US$2.59bn; non-GAAP net income grew by 46% YoY to US$707mn, beating consensus estimate by 7%, mainly driven by the enhanced operating efficiency.</li><li>cRPO was up 21% YoY on a constant currency basis in 1Q24, which is a 100bps beat versus pervious guidance, thanks to the strong deal acquisition in 1Q24.</li><li>For 2Q24E, management guide subscription revenue/cRPO to grow by 22/20.5% YoY on a constant currency basis, in line with the consensus estimates.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

ServiceNow announced 1Q24 results: total revenue increased by 24% YoY to US$2.60bn, in line with consensus estimate of US$2.59bn; non-GAAP net income grew by 46% YoY to US$707mn, beating consensus estimate by 7%, mainly driven by the enhanced operating efficiency.cRPO was up 21% YoY on a constant currency basis in 1Q24, which is a 100bps beat versus pervious guidance, thanks to the strong deal acquisition in 1Q24.For 2Q24E, management guide subscription revenue/cRPO to grow by 22/20.5% YoY on a constant currency basis, in line with the consensus estimates.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

ServiceNow (NOW US) - Strong Adoption of GenAI Solutions

United States

ServiceNow, Inc. provides enterprise information technology (IT) management software. The Company designs, develops, and produces prepackaged computer software, cloud services, and IT service management platform. ServiceNow serves customers throughout the United States.

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Servicenow Inc (NOW US)

SailPoint IPO Valuation Analysis: Paying Debt With IPO Proceeds and $1B+ ARR in FY26

SailPoint is expected to IPO in February. In my insight, I discuss valuation comps, IPO valuation and outline key risks for IPO investors.

Andrei Zakharov

ServiceNow Inc.: Expanding Market Reach Through Partnerships and Cloud Solutions & Other Major Drivers

ServiceNow's second quarter of 2024 financial results indicate strong operational and financial momentum, with notable increases in important...

Baptista Research

Internet - AI and Margin Expansion Still Key Themes

US internet and software companies delivered mixed performances in 1Q24 in terms of revenue growth: advertising and cloud services revenue growth...

CMB International

ServiceNow Inc: How Will The Adoption of GenAI Technology Impact Their Future Revenues & Profitability? - Major Drivers

ServiceNow had a strong first quarter in 2024, outperforming guidance on all top-line and profitability metrics. The company’s subscription...

Baptista Research

ServiceNow (NOW US) - Strong Adoption of GenAI Solutions

ServiceNow announced 1Q24 results: total revenue increased by 24% YoY to US$2.60bn, in line with consensus estimate of US$2.59bn; non-GAAP net...

CMB International

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