Shares of MongoDB (MDB, Financial) surged today following a stellar second-quarter earnings report that exceeded expectations on both revenue and profitability fronts. The company also raised its yearly guidance. The stock experienced an impressive 15.5% increase, with the share price reaching $283.81.
MongoDB (MDB, Financial) reported a strong financial performance this quarter. Revenue rose by 13% to $478.1 million, surpassing the forecast of $464.1 million. The company’s cloud-based Atlas segment showcased robust growth with a 27% increase in revenue, now accounting for 71% of the total revenue. Its customer base also expanded, growing from over 49,200 to more than 50,700, including 52 new customers with annual spending of at least $100,000.
Despite a slight decrease in gross margin from 75% to 73% and an increase in GAAP operating loss due to higher operating expenses, MongoDB reported adjusted earnings per share at $0.70, exceeding the consensus estimate of $0.49. The company attributed the dip in profits to increased investments in AI.
CEO Dev Ittycheria highlighted strong new workload acquisition and better-than-expected Atlas consumption trends. Additionally, MongoDB launched the MongoDB AI Applications Program, which includes partnerships with generative AI companies like Anthropic and leading cloud infrastructure platforms.
Looking ahead, MongoDB forecasts third-quarter revenue between $493 million and $497 million, representing a 17% increase at the midpoint, and adjusted earnings per share of $0.65 to $0.68. For the full year, the company has raised its revenue forecast to between $1.92 billion and $1.93 billion and expects adjusted EPS to be between $2.33 and $2.47, surpassing analyst expectations.
MongoDB (MDB, Financial) is currently valued with a market capitalization of $20.82 billion and exhibits a GF Value of $471.06. According to GF Value, the stock is considered significantly undervalued. The company holds a strong financial position with an Altman Z-Score of 6.26, indicating financial stability. Additionally, it boasts a high Piotroski F-Score of 7, suggesting a very healthy financial situation.
Despite recent insider selling, MongoDB’s operating margin is expanding, which is a positive indicator of profitability. The stock’s price-to-book (PB) ratio is close to its 5-year low, and its price-to-sales (PS) ratio is near its 1-year low, further underscoring its undervalued status. The company’s balance sheet remains strong, with a high cash ratio of 4.93, underscoring its liquidity and financial health.
In terms of growth, MongoDB has an impressive 3-year revenue growth rate of 33.1%, ranking in the top 13% of the industry. With the launch of its AI Applications Program and continued strong performance in the Atlas segment, MongoDB is positioned well for future growth.
For investors, MongoDB (MDB, Financial) remains a speculative growth stock with a GF Score of 74, combining strong growth potential with financial health. The stock’s significant undervaluation, given its current GF Value, makes it a noteworthy consideration for those looking to invest in the technology sector.
