Everbridge (EVBG) Keeps On Trucking
Everbridge reported Q4 2018 results the other night that were better than expected. Revenue was up 43% to $41.8 million while EPS of -$0.09 beat by a penny. For the full-year 2018, revenue was up 41% (versus 35.8% in 2017), while EPS came in at -$0.54.
There weren’t a lot of surprises, which is a good thing in this case. Everbridge continues to land deals (new and expanded) with multiple products, and expansion opportunities in Europe abound (population alerting is now mandated in Europe and creates a roughly $100 million market over just the next few years). Forward guidance also came in ahead of consensus ($185.6 million) at $195.1 million to $196.6 million, implying around 33% growth this year. Everbridge still won’t be profitable on an adjusted earnings basis until 2021. At its current trajectory we should expect 2019 EPS of around -$0.27, 2020 at -$0.06 and 2021 at $0.18. Stock based compensation is likely to jump a bit in 2019 given the strong stock performance. Investors should also be aware that both the CEO and CFO are stepping down this year, though the CFO will remain as Executive Chairman.
We’ve had a heck of a run with Everbridge and are now up around 338% on our remaining position. The stock’s not cheap on an EV/Forward Revenue basis, trading with a multiple of about 10X. But that’s below the peak multiple of 12.1x from last September so we’re not in nosebleed territory (yet). Plus, there is potential for Everbridge to beat its forward guidance so the actual multiple might be lower.
This handy one-year chart from YCharts shows both the stock price (blue line) and the EV/Forward Revenue multiple (orange line) over the last year.
I’m keeping the stock at Buy. But to balance the near-term risks I recommend that you just buy small blocks of shares. Don’t go in huge at these levels! BUY.
Tonight we hear from Repligen (RGEN), which is looking to rebound further after a correction in December. I’ll review the event and provide an update in tomorrow’s Weekly Update.