Yext, Inc. revenue jumped on 30.9% while EBITDA Margin decreased on 2.7 pp from -30.2% to -32.8%
03/03/2020 • About Yext, Inc. (
$YEXT) • By InTwits
Yext, Inc. reported FY2020 financial results today. Here are the key drivers of the company's long term financial model:
- Yext, Inc. is a fast growth stock: FY2020 revenue growth was 30.9%, 5 year revenue CAGR was 37.9% at FY2020 ROIC -56.6%
- The company operates at negative EBITDA Margin: -32.8%
- Yext, Inc. motivates its personel by high Stock Based Compensation (SBC): average SBC/Revenue for FY2016-FY2020 was 4.0% while average EBITDA Margin was -31.8% for the sames years
- Yext, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 4.4%. At the same time it's a lot of higher than industry average of 3.7%.
- CAPEX is quite volatile: $12m in FY2020, $5m in FY2019, $4m in FY2018, $4m in FY2017, $10m in FY2016
- The company has unprofitable business model: ROIC is -56.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 30.9%. Revenue growth showed slowdown in FY20Q4 - it was 27.6% YoY. Revenue decline was accelerating on average at -4.2 pp per annum in the last 5 years. Revenue growth was financed by EBITDA margin decline. EBITDA Margin decreased on 2.7 pp from -30.2% to -32.8% in FY2020.
Gross Margin decreased slightly on 0.63 pp from 74.9% to 74.2% in FY2020. Gross Margin grew at 2.2 pp per annum in FY2016-FY2020. SG&A as a % of Revenue increased on 6.6 pp from 92.2% to 98.8% in FY2020.
Net Income margin decreased on 7.9 pp from -32.8% to -40.7% in FY2020.
Investments (CAPEX, working capital and M&A)
Yext, Inc.'s CAPEX/Revenue was 4.0% in FY2020. CAPEX/Revenue increased slightly on 1.2 pp from 2.8% in FY2017 to 4.0% in FY2020. For the last three years the average CAPEX/Revenue was 2.8%. During the last 5 years CAPEX as a % of Revenue bottomed in FY2018 at 2.2% and was growing since that time.
Return on investment
The company operates at negative ROIC (-56.6%) and ROE (-85.1%). ROIC surged on 32.1 pp from -88.7% to -56.6% in FY2020. ROE increased on 5.1 pp from -90.2% to -85.1% in FY2020.
Leverage (Debt)
Debt level is -4.1x Net Debt / EBITDA and Debt / EBITDA. Debt surged while cash jumped on 179%.
Yext, Inc. has no short term refinancing risk: cash is higher than short term debt (2,963.8%).
Management team
Howard Lerman is a the company's CEO. Howard Lerman has spent 15 years with the company. The company's CFO Steven M Cakebread "Steve" has spent 6 years with the company.
Financial and operational results
FY ended 01/31/2020
Yext, Inc. ($YEXT) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 89.7 | 124.3 | 170.2 | 228.3 | 298.8 | 30.9% |
| Gross Profit | 58.7 | 87.3 | 126.1 | 170.9 | 221.8 | 29.8% |
| SG&A | 68.6 | 110.7 | 167.1 | 210.4 | 295.3 | 40.3% |
| EBITDA | -23.0 | -38.6 | -61.5 | -68.8 | -98.1 | |
| EBIT | -26.1 | -42.7 | -66.6 | | | |
| Tax | -0.1 | 0.1 | 0.2 | | | |
| Net Income | -26.5 | -43.2 | -66.6 | -74.8 | -121.5 | |
| Stock Based Compensation | 4.5 | 9.9 | 22.4 | | | |
Balance Sheet
|
|---|
| Cash | 30.0 | 24.4 | 34.4 | 91.8 | 256.1 | 179.1% |
| Accounts Receivable | 24.2 | 27.6 | 44.7 | | | |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 8.6 | |
| Long Term Debt | 0.0 | 5.0 | 0.0 | 0.0 | 115.2 | |
Cash flow
|
|---|
| Capex | 9.8 | 3.5 | 3.7 | 5.3 | 11.9 | 125.6% |
| Acquisitions | 0.2 | | | | | |
Ratios
|
|---|
| Revenue growth | 49.5% | 38.5% | 37.0% | 34.1% | 30.9% | |
| EBITDA growth | 42.5% | 67.7% | 59.3% | 11.9% | 42.5% | |
|
|---|
| Gross Margin | 65.4% | 70.3% | 74.1% | 74.9% | 74.2% | -0.6% |
| EBITDA Margin | -25.7% | -31.1% | -36.1% | -30.2% | -32.8% | -2.7% |
| EBIT Margin | -29.1% | -34.4% | -39.2% | | |
| SG&A, % of revenue | 76.5% | 89.1% | 98.2% | 92.2% | 98.8% | 6.6% |
| SBC, % of revenue | 5.0% | 7.9% | 13.1% | | |
| Net Income Margin | -29.5% | -34.7% | -39.1% | -32.8% | -40.7% | -7.9% |
| CAPEX, % of revenue | 10.9% | 2.8% | 2.2% | 2.3% | 4.0% | 1.7% |
|
|---|
| ROIC | | -343.6% | -161.4% | -88.7% | -56.6% | 32.1% |
| ROE | | | | -90.2% | -85.1% | 5.1% |
People
|
|---|
| Insider ownership | 14.6% | 14.6% | 14.6% | | | |
| Employees | | 630 | 800 | | | |
| Revenue/Employee, th. $ | | 197 | 213 | | | |
Yext, Inc. ($YEXT) key quoterly financial indicators
| mln. $ | FY20Q1 | FY20Q2 | FY20Q3 | FY20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 69 | 72 | 76 | 81 | | 34.8% | 31.4% | 30.0% | 27.6% |
| EBITDA | -15 | -24 | -36 | -24 | | - | - | - | - |
| Net Income | -19 | -29 | -43 | -31 | | - | - | - | - |
Balance Sheet
|
|---|
| Cash | 258 | 269 | 245 | 256 | | 382.5% | 470.0% | 763.7% | 179.1% |
| Short Term Debt | 2 | 7 | 8 | 9 | | - | - | - | - |
| Long Term Debt | 35 | 109 | 110 | 115 | | - | - | - | - |
Ratios
|
|---|
| Gross Margin | 76.0% | 73.4% | 73.3% | 74.3% | | 1.1% | -1.1% | -1.3% | -1.2% |
| EBITDA Margin | -22.2% | -32.6% | -46.8% | -28.9% | | 7.9% | 2.8% | -7.5% | -6.3% |
| Net Income Margin | -27.6% | -40.5% | -55.9% | -37.6% | | 5.8% | -2.2% | -13.8% | -13.3% |
Peers in Application Software
Below you can find Yext, Inc. benchmarking vs. other companies in Application Software industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | - | -0.2% | -95.9% | 34.9% | 355,942.4% |
| AudioEye, Inc. ($AEYE) | - | 175.5% | 106.6% | 90.2% | 90.2% |
| Cloudera, Inc. ($CLDR) | - | 57.2% | 42.6% | 28.9% | 65.5% |
| Integrated Ventures Inc ($INTV) | - | - | - | -8.9% | 62.7% |
| Smartsheet Inc. ($SMAR) | - | 64.3% | 66.1% | 59.7% | 52.4% |
| |
|---|
| Median (92 companies) | 12.0% | 14.8% | 15.1% | 19.4% | 14.5% |
|---|
| Yext, Inc. ($YEXT) | - | 38.5% | 37.0% | 34.1% | 30.9% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Aware, Inc. ($AWRE) | 90.3% | 94.6% | 92.3% | 89.7% | 92.8% |
| Alteryx, Inc. ($AYX) | 81.3% | 83.4% | 91.0% | 90.6% | 91.1% |
| Autodesk, Inc. ($ADSK) | 85.2% | 83.2% | 85.2% | 88.9% | 90.1% |
| Smith Micro Software, Inc. ($SMSI) | 73.2% | 77.9% | 83.5% | 90.9% | 89.9% |
| Cadence Design Systems, Inc. ($CDNS) | 85.9% | 87.8% | 87.9% | 88.6% | 88.6% |
| |
|---|
| Median (89 companies) | 63.8% | 64.4% | 65.3% | 67.9% | 69.4% |
|---|
| Yext, Inc. ($YEXT) | 65.4% | 70.3% | 74.1% | 74.9% | 74.2% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -1,837.2% | -1,118.0% | -40,379.4% | -23,127.1% | 52.2% |
| j2 Global, Inc. ($JCOM) | 41.7% | 36.5% | 35.7% | 38.6% | 40.5% |
| Intelligent Systems Corporation ($INS) | -5.4% | -12.8% | 33.6% | 43.6% | 40.4% |
| Adobe Inc. ($ADBE) | 31.2% | 34.2% | 35.3% | 35.8% | 39.7% |
| SS&C Technologies Holdings, Inc. ($SSNC) | 34.9% | 37.9% | 27.7% | 38.2% | 38.3% |
| |
|---|
| Median (89 companies) | -4.7% | -3.3% | -3.3% | 4.5% | 7.7% |
|---|
| Yext, Inc. ($YEXT) | -25.7% | -31.1% | -36.1% | -30.2% | -32.8% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| MicroStrategy Incorporated ($MSTR) | 0.5% | 0.8% | 1.4% | 2.1% | 234.8% |
| Integrated Ventures Inc ($INTV) | - | - | 199.9% | 15.2% | 27.2% |
| Intelligent Systems Corporation ($INS) | 3.8% | 9.7% | 4.3% | 4.9% | 19.2% |
| LivePerson, Inc. ($LPSN) | 5.5% | 7.9% | 8.8% | 16.3% | 11.4% |
| PROS Holdings, Inc. ($PRO) | 4.7% | 0.8% | 0.7% | 2.1% | 11.3% |
| |
|---|
| Median (87 companies) | 2.9% | 2.3% | 2.4% | 3.0% | 2.5% |
|---|
| Yext, Inc. ($YEXT) | 10.9% | 2.8% | 2.2% | 2.3% | 4.0% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| VirnetX Holding Corp ($VHC) | -210.9% | -256.8% | -416.3% | -247.2% | 137.3% |
| Manhattan Associates, Inc. ($MANH) | 99.3% | 102.5% | 80.9% | 71.7% | 53.4% |
| Citrix Systems, Inc. ($CTXS) | 16.1% | 16.7% | 25.2% | 29.8% | 33.5% |
| Sonic Foundry, Inc. ($SOFO) | -18.1% | -50.6% | -786.4% | - | 31.3% |
| Paycom Software, Inc. ($PAYC) | 75.4% | 51.1% | 47.5% | 47.5% | 28.7% |
| |
|---|
| Median (92 companies) | -9.5% | -10.2% | -9.8% | -4.2% | -1.8% |
|---|
| Yext, Inc. ($YEXT) | - | -343.6% | -161.4% | -88.7% | -56.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Dropbox, Inc. ($DBX) | - | -3.8x | - | 2.4x | 1,341.0x |
| Avaya Holdings Corp. ($AVYA) | - | - | 7.4x | - | 77.9x |
| Alteryx, Inc. ($AYX) | - | - | 2.5x | 6.1x | 32.2x |
| Five9, Inc. ($FIVN) | -6.7x | -8.6x | 7.3x | 5.3x | 17.6x |
| Synchronoss Technologies, Inc. ($SNCR) | - | - | - | - | 11.6x |
| |
|---|
| Median (54 companies) | -0.9x | -0.8x | -0.7x | 0.4x | 0.2x |
|---|
