cloudedjudgement.substack.com · 2022-04-22 · 1504d

Clouded Judgement: Q1 2022 SaaS Valuation Compression and Forward Guidance Risk

The article analyzes Q1 2022 SaaS earnings season, highlighting severe multiple compression across the sector despite strong business fundamentals, and forecasts that conservative forward guidance may emerge as recession risks materialize. Key focus is on valuation multiples, growth-adjusted pricing, and the divergence between stable operating metrics and collapsing stock valuations.

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Metrics in this report

1-Year Trailing Average EV / NTM Revenue Multiple

13.5x

average

Public SaaS companies, 12-month rolling average through Jan 2022

3-Month Trailing Average EV / NTM Revenue Multiple

9.4x

average

Public SaaS companies, 3-month rolling average through Jan 2022

High Growth EV / NTM Revenue Multiple

10.6x

median

SaaS companies with >30% projected NTM growth, Jan 2022

Low Growth EV / NTM Revenue Multiple

3.8x

median

SaaS companies with <15% projected NTM growth, Jan 2022

Median CAC Payback Period

23months

median

Public SaaS companies

Median EV / NTM Revenue Multiple

8.3x

median

Public SaaS companies, Jan 2022

Median FCF Margin

3percent

median

Public SaaS companies

Median Gross Margin

74percent

median

Public SaaS companies

Median NTM Revenue Growth

26percent

median

Public SaaS companies

Median Net Retention Rate

120percent

median

Public SaaS companies

Median Operating Margin

-23percent

median

Public SaaS companies

Median R&D % Revenue

26percent

median

Public SaaS companies

Median S&M % Revenue

45percent

median

Public SaaS companies

Mid Growth EV / NTM Revenue Multiple

8.2x

median

SaaS companies with 15-30% projected NTM growth, Jan 2022

Top 5 Median EV / NTM Revenue Multiple

24.8x

median

Top 5 highest-valued SaaS companies by multiple, Jan 2022