Part 1: Deep dive on VTEX ($VTEX)
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Company: VTEX
Ticker: (VTEX)
Website: https://vtex.com/us-en/
IPO date: July 21, 2021
IPO price: $19.00
Current stock price: $6.73
Outstanding shares: 187.82 million
52 week high: $7.15 on November 20, 2023
52 week low: $3.18 on December 22, 2022
ATH: $33.36 on August 10, 2021
Market cap: $1.26 billion
Net cash/debt: $209 million
Enterprise value: $1.05 billion
Headquarters: London, United Kingdom
Number of employees: 1,270+
Average price target from analysts: $7.86 (only a few analysts cover VTEX)
Investor Relations: https://www.investors.vtex.com/
Q3 2023 Earnings Report: https://s28.q4cdn.com/761427389/files/doc_financials/2023/q3/_VTEX-3Q23-Earnings-Press-Release-pptx.pdf
Business Overview (November 2023): https://s28.q4cdn.com/761427389/files/doc_financials/2023/q3/VTEX-3Q23-Earnings-Presentation.pdf
Investor Day (July 2023): https://s28.q4cdn.com/761427389/files/doc_presentations/07/VTEX-Investor-Day-2023.pdf
Outline
Introduction [part 1]
Company Background [part 1]
Opportunity [part 1]
Business Model [part 1]
Competitive Advantages [part 1]
Risks [part 1]
Valuation [part 2]
Investment Model [part 2]
Analysts [part 2]
Technicals [part 2]
Conclusion [part 2]
Additional Sources [part 1]
Many investors and Wall Street strategists believe that 2024 will be a very strong year for small/mid caps and I agree.
Over the past 28 years the Russell 2000 (aka IWM) has only had 4 double digit negative years (2002, 2008, 2018, 2022) however the combined returns of the 2 years following those negative double years is 51.5% and with $IWM currently up 17.5% YTD that means next year IWM could be setting up for a monster year. FWIW, the average of the 5 best years since 1995 is 31.5% and I think it’s possible if inflation continues coming down and the FOMC starts cutting rates while the economy and labor markets remain strong.
Several weeks ago I ran a stock screener looking for companies with market caps between $1 billion and $10 billion that are expected to grow revenues by 20% or more in 2023, 2024 and 2025 while being EBITDA positive in 2023, 2024 and 2025. There were ~32 results (not including China & Russia companies) however several of these companies are in the process of being acquired (including IMGN, ESMT, OLK) so the ones left that met my criteria were:
ACMR
AMPS
ATAT
BE
BROS
CYBR
DLO
DUOL
DV
FLYW
FOUR
FROG
FRPT
GLBE
GSHD
HIMS
INSP
MARA
MNDY
NOVA
ONON
OWL
RELY
SHLS
SPT
SWAV
SYM
TOST
VTEX
Out of all the names on this list the company I was the least familiar with was VTEX so that’s why I decided to do this deep dive… to figure out if this was a company I should be paying attention to and how much potential upside the stock might have over the next few years.