Sunday, June 1, 2025
News PouroverAI
Visit PourOver.AI
No Result
View All Result
  • Home
  • AI Tech
  • Business
  • Blockchain
  • Data Science & ML
  • Cloud & Programming
  • Automation
  • Front-Tech
  • Marketing
  • Home
  • AI Tech
  • Business
  • Blockchain
  • Data Science & ML
  • Cloud & Programming
  • Automation
  • Front-Tech
  • Marketing
News PouroverAI
No Result
View All Result

‘Hey above-median spender’ – Jefferies highlights software/net picks

October 1, 2023
in Business
Reading Time: 3 mins read
0 0
A A
0
Share on FacebookShare on Twitter


Kativ

Capital deployment is a key factor when choosing top stocks in the software and internet sector, according to a joint study by the Jefferies quant and equity research teams.

The teams looked at 10 years of data on 45 stocks with research coverage and market caps topping $1B to determine “the correlation between the amount of capital spend (capex, R&D, acquisitions) and subsequent outperformance in ROIC, revenue growth, and stock returns.”

“Best factor: total spend to invested capital ratio,” analyst Brent Thill wrote. “Companies with above median spend to IC had superior stock performance (36% over 2 years and 58% over 3 years compared to companies with below median spend) and faster sales growth (CAGR 11-12% better).”

“Acquisition spend was a poor predictor of stock outperformance (only low single digit %),” Thill said. “These speak to the importance of efficient and strategic capital allocation.”

The teams split stocks into four subcategories:

Infrastructure software

Favorable (current capex spend leaders for whom higher capex spend was rewarded by the market in the past)

Fortinet (FTNT), current capex/IC 32.6%, difference vs. sector median 22.8 percentage points Cloudflare (NET) 30.2%, 20.3 ppt Datadog (DDOG) 17.4%, 7.6 ppt Microsoft (MSFT)16.0%, 6.2 ppt

Lacking catalysts (low levels of capex spend now relative to sector median)

Snowflake (SNOW) 10.7%, 0.9 ppt Oracle (ORCL) 9.8%, 0.0 ppt Palo Alto Networks (PANW) 5.9% -3.9 ppt Dynatrace (DT) 2.2%, -7.6 ppt Elastic (ESTC) 1.7%, -8.2 ppt Splunk (SPLK) 1.6%, -8.3 ppt Progress Software (PRGS) 0.6%, -0.9.2 ppt

Application software screening

Favorable (current R&D spend leaders for whom higher R&D spend was rewarded by the market in the past)

Atlassian (TEAM) R&D/IC current 5,911.7%, difference vs. sector median 5,866.1 ppt DocuSign (DOCU) 206.3%, 160.7 ppt

Unfavorable (current R&D spend leaders for whom higher R&D spend was NOT rewarded by the market in the past)

Asana (ASAN) 239.2%, 193.5 ppt Smartsheet (SMAR) 225.0%, 179.4 ppt Dropbox (DBX) 177.9%, 132.3 ppt Workday (WDAY), 87.1%, 41.5 ppt

Lacking catalysts(low levels of R&D spend now relative to sector median)

Procore (PCOR) 45.6%, 0.0 ppt Adobe (ADBE), 23.6%, -22 ppt Intuit (INTU) 11.9%, -33.7 ppt Salesforce (CRM) 8.9%, -36.7 ppt MicroStrategy (MSTR) 4.7%, -40.9 ppt Instructure (INST) 4.6%, -41.1 ppt PowerSchool (PWSC) 3.3%, -42.3 ppt

Social media

Favorable (current R&D leaders for whom higher R&D was rewarded by the market in the past)

Meta (META) 32.1%, 4.2 ppt Alphabet (GOOG) (GOOGL) 27.9%, 0.0 ppt

Lacking catalysts (low levels of R&D now relative to sector median)

Match Group (MTCH), 11.7%, -16.2 ppt IAC (IAC), 6.5%, -21.4 ppt

Other software/internet

Favorable (current R&D leaders for whom higher R&D was rewarded by the market in the past)

Upwork (UPWK) 100.4%, 72.5 ppt Sonos (SONO) 79.0%, 51.1 ppt Amazon.com (AMZN), 32.3%. 4.4 ppt Etsy (ETSY) 30.4%, 2.5 ppt

Lacking catalysts (low levels of R&D now relative to sector median)

GoDaddy (GDDY) 22.8% -5.1 ppt Chegg (CHGG) 20.3%, -7.6 ppt eBay (EBAY) 17.8%, -10.1 ppt



Source link

Tags: abovemedianHeyHighlightsJefferiespickssoftwarenetspender
Previous Post

7 Incredible Features of GPT-4 Vision

Next Post

stock market: London on cusp of becoming biggest stock market in Europe, again

Related Posts

Can You Guess What Percentage Of Their Wealth The Rich Keep In Cash?
Business

Can You Guess What Percentage Of Their Wealth The Rich Keep In Cash?

June 10, 2024
UGRO Capital: Targeting to hit milestone of Rs 20,000 cr loan book in 8-10 quarters: Shachindra Nath
Business

UGRO Capital: Targeting to hit milestone of Rs 20,000 cr loan book in 8-10 quarters: Shachindra Nath

June 10, 2024
Blinken set to arrive in Egypt for Gaza ceasefire push By Reuters
Business

Blinken set to arrive in Egypt for Gaza ceasefire push By Reuters

June 10, 2024
Volvo is moving EV production from China to Belgium as the EU eyes tariffs on Beijing
Business

Volvo is moving EV production from China to Belgium as the EU eyes tariffs on Beijing

June 9, 2024
France’s Macron calls for snap election after losing big to the far right in EU vote
Business

France’s Macron calls for snap election after losing big to the far right in EU vote

June 9, 2024
Upgrades for Best Buy and Lululemon By Investing.com
Business

Upgrades for Best Buy and Lululemon By Investing.com

June 9, 2024
Next Post
stock market: London on cusp of becoming biggest stock market in Europe, again

stock market: London on cusp of becoming biggest stock market in Europe, again

Where to Watch Hell’s Kitchen in 2023 [Free Streaming Options]

Where to Watch Hell’s Kitchen in 2023 [Free Streaming Options]

‘Do not trust the rumour mills’: Ghulam Nabi Azad denies interest in J-K Lt Governor post

'Do not trust the rumour mills': Ghulam Nabi Azad denies interest in J-K Lt Governor post

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

  • Trending
  • Comments
  • Latest
Is C.AI Down? Here Is What To Do Now

Is C.AI Down? Here Is What To Do Now

January 10, 2024
Accenture creates a regulatory document authoring solution using AWS generative AI services

Accenture creates a regulatory document authoring solution using AWS generative AI services

February 6, 2024
23 Plagiarism Facts and Statistics to Analyze Latest Trends

23 Plagiarism Facts and Statistics to Analyze Latest Trends

June 4, 2024
Managing PDFs in Node.js with pdf-lib

Managing PDFs in Node.js with pdf-lib

November 16, 2023
From Low-Level to High-Level Tasks: Scaling Fine-Tuning with the ANDROIDCONTROL Dataset

From Low-Level to High-Level Tasks: Scaling Fine-Tuning with the ANDROIDCONTROL Dataset

June 10, 2024
Turkish Airlines Marketing Strategy: Beyond “Globally Yours”

Turkish Airlines Marketing Strategy: Beyond “Globally Yours”

May 29, 2024
Can You Guess What Percentage Of Their Wealth The Rich Keep In Cash?

Can You Guess What Percentage Of Their Wealth The Rich Keep In Cash?

June 10, 2024
AI Compared: Which Assistant Is the Best?

AI Compared: Which Assistant Is the Best?

June 10, 2024
How insurance companies can use synthetic data to fight bias

How insurance companies can use synthetic data to fight bias

June 10, 2024
5 SLA metrics you should be monitoring

5 SLA metrics you should be monitoring

June 10, 2024
From Low-Level to High-Level Tasks: Scaling Fine-Tuning with the ANDROIDCONTROL Dataset

From Low-Level to High-Level Tasks: Scaling Fine-Tuning with the ANDROIDCONTROL Dataset

June 10, 2024
UGRO Capital: Targeting to hit milestone of Rs 20,000 cr loan book in 8-10 quarters: Shachindra Nath

UGRO Capital: Targeting to hit milestone of Rs 20,000 cr loan book in 8-10 quarters: Shachindra Nath

June 10, 2024
Facebook Twitter LinkedIn Pinterest RSS
News PouroverAI

The latest news and updates about the AI Technology and Latest Tech Updates around the world... PouroverAI keeps you in the loop.

CATEGORIES

  • AI Technology
  • Automation
  • Blockchain
  • Business
  • Cloud & Programming
  • Data Science & ML
  • Digital Marketing
  • Front-Tech
  • Uncategorized

SITEMAP

  • Disclaimer
  • Privacy Policy
  • DMCA
  • Cookie Privacy Policy
  • Terms and Conditions
  • Contact us

Copyright © 2023 PouroverAI News.
PouroverAI News

No Result
View All Result
  • Home
  • AI Tech
  • Business
  • Blockchain
  • Data Science & ML
  • Cloud & Programming
  • Automation
  • Front-Tech
  • Marketing

Copyright © 2023 PouroverAI News.
PouroverAI News

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In