Monday.com Q2 Earnings: High Customer Retention And Rising ARR, Guidance Hike And More

Monday.com Ltd MNDY reported fiscal second-quarter 2024 revenue growth of 34% Y/Y to $236.1 million, beating the analyst consensus estimate of $228.8 million. 

The project management software company’s adjusted EPS of $0.94 beat the analyst consensus estimate of $0.56. The stock price gained after the results.

The net dollar retention rate was 110%, with the net dollar retention rate for customers with more than ten users being 114%.

The number of paid customers with over $50,000 in annual recurring revenue (ARR) rose 43% year over year to 2,713. The adjusted operating margin was 16% versus 9% the prior year.

In the quarter, MNDY generated net cash from operating activities of $55.8 million, with $50.8 million of free cash flow, compared to $47.6 million and $45.9 million, respectively, a year ago. MNDY held $1.29 billion in cash and equivalents as of June-end.

CFO Eliran Glazer said, “These results demonstrate not only our highly effective execution, but the strong demand we continue to see even through a challenging macroeconomic environment.”

Outlook: Monday.com expects third-quarter revenue of $243 million–$247 million (versus the consensus of $243.05 million) and adjusted operating margin of 8%–9%.

Monday.com expects 2024 revenue guidance of $956 million—$961 million (prior $942 million—$948 million) against the consensus of $947.79 million and an adjusted operating margin of 10%—11% (prior 8%—9%).

Monday.Com Stock Prediction For 2024

Equity research can be a valuable source of information for learning about a company's fundamentals. Analysts create financial models based on the fundamentals and expected future earnings of a company to arrive at a price target and recommendation for the stock.

Shares of Monday.Com have an average 1-year price target of $265.71, representing an expected upside of 17.73%.

Because of differences in assumptions, analysts can arrive at very different price targets and recommendations. No analysts have bearish recommendations on Monday.Com, while 12 analysts have bullish ratings. The street high price target from Wolfe Research is $300.0, while the street low from DA Davidson is $230.0.

Monday.Com stock gained over 33% in the last 12 months.

Price Action: MNDY shares are trading higher by 8.48% at $244.83 premarket at the last check Monday.