SurveyMonkey’s Solid Q4 Is An Indication Of Its Amazing Future Growth Story

Global market analysis participant, SurveyMonkey acquired its holding firm SVMK Inc. (NASDAQ:SVMK) listed in September 2018 and the stock has carried out properly ever since. The 3-month appreciation has been about 6.43% and the nice efficiency has largely been a operate of the sound quarterly outcomes being delivered by the corporate which is demonstrating a income progress within the late teenagers. At its present stage, the stock seems to be funding proposition for progress buyers.

A Solid Quarterly Result To Finish 2018

SurveyMonkey managed to beat analyst expectations for the second quarter in a row after its itemizing. The firm’s outcomes beat the analyst consensus estimate as per Factset on each, the income in addition to the EPS entrance. The firm reported a top-line of $67.90 million which was an 18.9% enchancment over the corresponding quarter of the earlier yr. These revenues have been $2.70 million increased than Q3 2018 and $2.07 million increased than analyst estimates.

While the web loss of the corporate widened as in comparison with Q3, it was considerably decrease than what analysts surveyed by Factset had estimated. The firm’s EPS for Q4 2018 was $-0.03 whereas analysts had anticipated it to be as little as $-0.17 implying a big enchancment.

SurveyMonkey went by means of with its IPO in September 2018 and used its investor roadshows to leverage its buyer base. As a end result, the workforce managed to have an 11% Q-o-Q progress in clients which embody corporations like Workday, GoDaddy, Weight Watchers, and Lion Bike. The firm ended 2018 with roughly 647,000 paying customers, up 7% year-over-year and up over 25,000 paying customers from the top of Q3. The growing paying customers was pushed primarily by gross sales of SurveyMonkey enterprise, self-serve groups and different merchandise. The administration has pushed an annual mixture of paying customers to 77%, up from 76% a yr in the past whereas growing the worth earned from paying customers. This is the rationale why the corporate’s annualized ARPU for Q4 was $425, up 13% year-over-year and 2% quarter-over-quarter.

Where Is The Revenue Coming From?

SurveyMonkey operates throughout 3 most important enterprise segments: Customer Experience Management, Market Research, and Talent Management. Each of those markets has excessive progress and SurveyMonkey is progressively constructing a robust place in every of them. Another constructive facet of the enterprise is the truth that 36% of SurveyMonkey’s revenues come from worldwide operations and that is although the administration has invested little or no in worldwide enlargement. The firm has caught to the fundamentals and labored on elements resembling translation of the web site to go well with native languages, offering native cost choices, and so forth. With growing revenues coming in from Europe, notably from non-English talking nations, SurveyMonkey is working in the direction of launching a European information heart within the first half of 2019 to enhance the person expertise, web site pace and supply regionally hosted information. The administration can also be hiring a brand new gross sales workforce for the European market.

The CFO Retirement

SurveyMonkey’s administration introduced that its Chief Financial Officer, Tim Maly is retiring within the second quarter of 2019 for ‘personal reasons’. Maly is predicted to proceed in his present position till March 30, 2019 after which function a non-executive worker till June 30, 2019 to assist the corporate seek for his alternative and full the handover course of. It seems to be a really clean transition and there are no actual fears with respect to administration instability within the firm.

Key Takeaways

There is a motive why SurveyMonkey is buying and selling at an EV-to-Revenue of about 8.78. The firm has a strong progress story within the pipeline given the elevated company spending on market analysis throughout the globe. The administration has simply acquired started with penetrating Europe and it has large, unexplored markets in Asia and the Middle East so the expansion price is simply anticipated to go up. The work on the margins entrance can also be commendable as the corporate is nearing profitability with each passing yr. With a lot of worldwide enlargement potential within the bag, SurveyMonkey seems to be to be a strong wager for progress buyers over a long-term horizon.