SailPoint Technologies Holdings, Inc. EBITDA jumped on 137% and EBITDA Margin increased on 3.1 pp from 3.6% to 6.7%
02/25/2021 • About SailPoint Technologies Holdings, Inc. (
$SAIL) • By InTwits
SailPoint Technologies Holdings, Inc. reported 2020 financial results today. Here are the key drivers of the company's long term financial model:
- SailPoint Technologies Holdings, Inc. is a fast growth stock: 2020 revenue growth was 26.6%, 5 year revenue CAGR was 30.8% at 2020 ROIC 0.32%
- EBITDA Margin is quite volatile: 6.7% in 2020, 3.6% in 2019, 8.7% in 2018, 10.8% in 2017, 9.6% in 2016
- SailPoint Technologies Holdings, Inc. spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for 2016-2020 is 2.0%. Average EBITDA Margin for the same period was 7.3%
- SailPoint Technologies Holdings, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.8%. At the same time it's in pair with industry average of 14.0%
- CAPEX is quite volatile: $4m in 2020, $6m in 2019, $8m in 2018, $3m in 2017, $1m in 2016
- In the last 5 years the company invested considerably less than D&A: $22m vs. $31m
- The company has potentially unprofitable business model: ROIC is 0.3%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 26.6%. Revenue growth showed slowdown in 20Q4 - it was 16.1% YoY. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 8.9 pp from -0.50% to 8.4% in 2020.
Gross Margin decreased slightly on 0.78 pp from 77.3% to 76.5% in 2020. During 2016-2020 Gross Margin topped in 2018 at 78.0% and was declining since that time. SG&A as a % of Revenue decreased on 4.3 pp from 61.1% to 56.8% in 2020. During the last 5 years SG&A as a % of Revenue topped in 2019 at 61.1%.
Net Income margin showed almost no change in 2020.
Investments (CAPEX, working capital and M&A)
In 2020 the company had CAPEX/Revenue of 1.1%. The company showed almost no change in CAPEX/Revenue from 2017 to 2020. Average CAPEX/Revenue for the last three years was 2.2%. During 2016-2020 CAPEX as a % of Revenue topped in 2018 at 3.4% and was declining since that time.
Return on investment
The company operates at low but positive ROIC (0.3%) and negative ROE (-2.4%). ROIC increased slightly on 1.6 pp from -1.3% to 0.32% in 2020. ROE showed almost no change in 2020.
Leverage (Debt)
Company's Net Debt / EBITDA is -5.9x and Debt / EBITDA is 15.1x. Debt increased on 4.4% while cash surged on 15.0%.
SailPoint Technologies Holdings, Inc. has no short term refinancing risk: cash is higher than short term debt (153.0%).
Management team
The company's CEO is Mark Mcclain. Mark Mcclain has 15 years tenure with the company. The company's CFO Jason Ream has spent 1 year with the company.
Financial and operational results
FY ended 12/31/2020
SailPoint Technologies Holdings, Inc. ($SAIL) key annual financial indicators| mln. $ | 2016 | 2017 | 2018 | 2019 | 2020 | 2020/2019 |
|---|
P&L
|
|---|
| Revenue | 132.4 | 186.1 | 248.9 | 288.5 | 365.3 | 26.6% |
| Gross Profit | 95.4 | 141.5 | 194.3 | 223.0 | 279.5 | 25.3% |
| SG&A | 68.3 | 98.2 | 140.2 | 176.4 | 207.4 | 17.6% |
| EBITDA | 12.7 | 20.2 | 21.6 | 10.3 | 24.3 | 136.6% |
| EBIT | 2.7 | 9.9 | 10.9 | | | |
| Interest expence | | 14.8 | 4.7 | | | |
| Tax | -2.0 | 2.3 | 1.1 | | | |
| Net Income | -3.2 | -7.6 | 3.7 | -8.5 | -10.8 | |
| Stock Based Compensation | 0.6 | 4.5 | 19.0 | | | |
Balance Sheet
|
|---|
| Cash | 18.2 | 116.0 | 71.0 | 443.8 | 510.3 | 15.0% |
| Accounts Receivable | 48.8 | 72.9 | 101.5 | | | |
| Accounts Payable | 0.8 | 2.2 | 4.6 | | | |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 4.0 | 333.5 | 8,340.0% |
| Long Term Debt | 107.3 | 68.3 | 0.0 | 347.1 | 33.1 | -90.5% |
Cash flow
|
|---|
| Capex | 1.3 | 2.7 | 8.4 | 6.2 | 3.9 | -36.1% |
| Dividends | | 50.0 | | | | |
Ratios
|
|---|
| Revenue growth | 38.9% | 40.5% | 33.8% | 15.9% | 26.6% | |
| EBITDA growth | 778.4% | 58.6% | 7.4% | -52.5% | 136.6% | |
|
|---|
| Gross Margin | 72.0% | 76.0% | 78.0% | 77.3% | 76.5% | -0.8% |
| EBITDA Margin | 9.6% | 10.8% | 8.7% | 3.6% | 6.7% | 3.1% |
| EBIT Margin | 2.1% | 5.3% | 4.4% | | |
| SG&A, % of revenue | 51.6% | 52.8% | 56.3% | 61.1% | 56.8% | -4.3% |
| SBC, % of revenue | 0.4% | 2.4% | 7.6% | | |
| Net Income Margin | -2.4% | -4.1% | 1.5% | -2.9% | -2.9% | -0.0% |
| CAPEX, % of revenue | 1.0% | 1.5% | 3.4% | 2.1% | 1.1% | -1.1% |
|
|---|
| ROIC | 0.9% | 2.8% | 2.8% | -1.3% | 0.3% | 1.6% |
| ROE | | | 1.0% | -2.1% | -2.4% | -0.3% |
| Net Debt/EBITDA | 7.0x | -2.4x | -3.3x | -9.0x | -5.9x | 3.1x |
| Interest coverage ratio (ICR) | | 0.7x | 2.3x | | |
| Interest expence / Average debt | | 21.6% | | | | |
People
|
|---|
| Insider ownership | 5.9% | 5.9% | 5.9% | | | |
SailPoint Technologies Holdings, Inc. ($SAIL) key quoterly financial indicators
| mln. $ | 20Q1 | 20Q2 | 20Q3 | 20Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 75 | 92 | 94 | 103 | | 24.5% | 46.6% | 23.9% | 16.1% |
| EBITDA | -1 | 13 | 6 | 2 | | - | - | -3.9% | -85.5% |
| Net Income | -8 | 3 | -1 | -5 | | - | - | -118.4% | -187.0% |
Balance Sheet
|
|---|
| Cash | 461 | 471 | 484 | 510 | | 434.9% | 405.8% | 4.2% | 15.0% |
| Short Term Debt | 4 | 4 | 327 | 333 | | 19.3% | 12.3% | 9,486.1% | 8,340.0% |
| Long Term Debt | 350 | 353 | 34 | 33 | | 782.5% | 809.3% | -90.0% | -90.5% |
Ratios
|
|---|
| Gross Margin | 75.4% | 80.1% | 77.9% | 72.9% | | -0.1% | 5.0% | 0.2% | -6.9% |
| EBITDA Margin | -0.9% | 13.7% | 5.9% | 1.6% | | 1.8% | 21.6% | -1.7% | -11.4% |
| Net Income Margin | -11.2% | 3.3% | -0.7% | -4.6% | | 2.7% | 17.9% | -5.6% | -10.6% |
Peers in Systems Software
Below we provide SailPoint Technologies Holdings, Inc. benchmarking against other companies in Systems Software industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Zscaler, Inc. ($ZS) | - | 56.5% | 51.3% | 59.2% | 42.4% |
| ServiceNow, Inc. ($NOW) | - | 38.0% | 36.0% | 32.6% | 30.6% |
| Rapid7, Inc. ($RPD) | - | 27.6% | 21.5% | 33.9% | 25.9% |
| Tenable Holdings, Inc. ($TENB) | - | 50.9% | 42.4% | 32.6% | 24.2% |
| Allot Communications Ltd. ($ALLT) | - | -9.3% | 16.9% | 14.9% | 23.5% |
| |
|---|
| Median (23 companies) | 12.9% | 14.0% | 19.0% | 19.4% | 12.9% |
|---|
| SailPoint Technologies Holdings, Inc. ($SAIL) | - | 40.5% | 33.8% | 15.9% | 26.6% |
Top companies by Gross margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Check Point Software Technologies Ltd. ($CHKP) | 88.5% | 88.6% | 89.6% | 89.5% | 89.4% |
| Progress Software Corporation ($PRGS) | 83.8% | 82.6% | 83.1% | 81.8% | 86.0% |
| Varonis Systems, Inc. ($VRNS) | 90.5% | 90.4% | 89.8% | 86.2% | 84.9% |
| Vmware, Inc. ($VMW) | 85.2% | - | 85.5% | 83.9% | 83.4% |
| Tenable Holdings, Inc. ($TENB) | 88.6% | 86.4% | 83.9% | 82.8% | 82.4% |
| |
|---|
| Median (23 companies) | 73.6% | 73.9% | 73.5% | 75.4% | 77.8% |
|---|
| SailPoint Technologies Holdings, Inc. ($SAIL) | 72.0% | 76.0% | 78.0% | 77.3% | 76.5% |
Top companies by EBITDA margin, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Check Point Software Technologies Ltd. ($CHKP) | 49.8% | 50.7% | 48.8% | 46.0% | 45.1% |
| Qualys, Inc. ($QLYS) | 23.8% | 25.1% | 28.4% | 36.5% | 40.3% |
| SolarWinds Corporation ($SWI) | -8.0% | 44.0% | 44.8% | 44.7% | 39.8% |
| Progress Software Corporation ($PRGS) | 2.4% | 28.6% | 32.9% | 23.4% | 34.4% |
| Fortinet, Inc. ($FTNT) | 7.2% | 11.1% | 15.9% | 19.8% | 23.9% |
| |
|---|
| Median (23 companies) | -9.8% | -5.4% | -4.7% | -1.4% | -1.1% |
|---|
| SailPoint Technologies Holdings, Inc. ($SAIL) | 9.6% | 10.8% | 8.7% | 3.6% | 6.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Zscaler, Inc. ($ZS) | 7.8% | 6.5% | 8.0% | 9.5% | 12.0% |
| ServiceNow, Inc. ($NOW) | 7.6% | 7.8% | 8.6% | 7.7% | 9.3% |
| Qualys, Inc. ($QLYS) | 11.7% | 16.4% | 8.2% | 8.6% | 8.3% |
| Zuora, Inc. ($ZUO) | 3.4% | 3.3% | 2.8% | 5.7% | 7.8% |
| Proofpoint, Inc. ($PFPT) | 9.2% | 9.0% | 4.1% | 4.0% | 6.9% |
| |
|---|
| Median (23 companies) | 2.1% | 2.4% | 2.5% | 3.8% | 3.4% |
|---|
| SailPoint Technologies Holdings, Inc. ($SAIL) | 1.0% | 1.5% | 3.4% | 2.1% | 1.1% |
Top companies by ROIC, %
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| Fortinet, Inc. ($FTNT) | 5.3% | 15.0% | 28.0% | 29.0% | 46.3% |
| Check Point Software Technologies Ltd. ($CHKP) | 24.7% | 26.8% | 25.5% | 24.2% | 25.6% |
| Qualys, Inc. ($QLYS) | 13.7% | 12.3% | 14.3% | 18.7% | 22.0% |
| Vmware, Inc. ($VMW) | 15.9% | - | - | 18.1% | 19.6% |
| Progress Software Corporation ($PRGS) | -4.9% | 13.5% | 18.5% | 7.6% | 16.0% |
| |
|---|
| Median (23 companies) | -4.3% | -4.7% | -1.9% | -6.4% | -6.4% |
|---|
| SailPoint Technologies Holdings, Inc. ($SAIL) | 0.9% | 2.8% | 2.8% | -1.3% | 0.3% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2016 | FY2017 | FY2018 | FY2019 | FY2020 |
|---|
| SolarWinds Corporation ($SWI) | - | 6.2x | 4.1x | 4.4x | 4.1x |
| Proofpoint, Inc. ($PFPT) | - | - | - | -27.4x | 2.5x |
| Progress Software Corporation ($PRGS) | -7.5x | -0.1x | 0.1x | 1.5x | 2.1x |
| Vmware, Inc. ($VMW) | -0.7x | - | -0.8x | 0.3x | 1.5x |
| CyberArk Software Ltd. ($CYBR) | -4.1x | -5.7x | -4.5x | -3.6x | 0.9x |
| |
|---|
| Median (11 companies) | -1.5x | -0.3x | -0.4x | -0.3x | 0.9x |
|---|
| SailPoint Technologies Holdings, Inc. ($SAIL) | 7.0x | -2.4x | -3.3x | -9.0x | -5.9x |
