cloudedjudgement.substack.com · 2021-11-12 · 1665d

Clouded Judgement

This article analyzes cloud software company valuations and operating metrics, featuring UBS analyst Karl Keirstead's bullish custom checks on Snowflake's momentum and market positioning. It presents quarterly earnings summaries, valuation multiples across top SaaS companies, and median operating metrics for the cohort, with particular focus on how growth rates correlate to revenue multiples and Rule of 40 scoring.

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Metrics in this report

CAC Payback Period

25months

median

Public SaaS companies on gross margin-adjusted basis

EV/NTM Revenue Multiple

16.0multiple

median

All public SaaS companies in cohort

EV/NTM Revenue Multiple

74.7multiple

median

Top 10 highest-multiple SaaS companies (Cloudflare, Snowflake, SentinelOne, etc.)

EV/NTM Revenue Multiple

21.0multiple

median

High-growth SaaS (>30% NTM growth)

EV/NTM Revenue Multiple

13.8multiple

median

Mid-growth SaaS (15%-30% NTM growth)

EV/NTM Revenue Multiple

7.1multiple

median

Low-growth SaaS (<15% NTM growth)

Free Cash Flow Margin

5percent

median

Public SaaS companies in cohort

G&A as % of Revenue

22percent

median

Public SaaS companies in cohort

Gross Margin

74percent

median

Public SaaS companies in cohort

LTM Growth Rate

32percent

median

Public SaaS companies in cohort

NTM Growth Rate

24percent

median

Public SaaS companies in cohort

Net Revenue Retention

119percent

median

Public SaaS companies in cohort

Operating Margin

-19percent

median

Public SaaS companies in cohort

R&D as % of Revenue

28percent

median

Public SaaS companies in cohort

Sales & Marketing as % of Revenue

44percent

median

Public SaaS companies in cohort

Snowflake Revenue Multiple

67multiple

target

CY22/FY23 forward estimates on Street; UBS raised PT to $440 implying 50x CY23/FY24