PCOR

Procore Technologies Inc

TMT


Presented:03/13/2024
Price:$79.00
Cap:$11.45B
Current Price:$62.84
Cap:$9.28B

Presented

Date03/13/2024
Price$79.00
Market Cap$11.45B
Ent Value$9.39B
P/E RatioN/A
Book Value$7.98
Div Yield0%
Shares O/S144.92M
Ave Daily Vol1,278,633
Short IntN/A

Current

Price$62.84
Market Cap$9.28B
Procore Technologies, Inc. engages in the development of cloud-based construction management software. The company was founded by Craig F. Courtemanche, Jr. and Steven C. Zahm in 2002 and is headquartered in Carpinteria, CA.

Publicly traded companies mentioned herein: Autodesk Inc (ADSK), Procore Technologies Inc (PCOR)

Highlights

The presenter is long shares of Procore Technologies Inc (PCOR), which is the market leader in construction management software. There have been major headwinds over the last ~18 months, most notably a cohort of customers renewing at lower volume commitments due to macroeconomic fears. Growth headwinds are expected to persist for the next quarter or two as the cycle troughs, but overall demand remains strong and growth should reaccelerate in 2H’24 as PCOR laps the smaller renewals. Management has discussed its priority to accelerate FCF per share growth, and the presenter thinks the consensus 2025 FCF estimate of $1.13 per share is too low. Using his 2025 FCF estimate implies a 35x valuation at the current $79 share price, which is low given PCOR’s positioning as a dominant vertical software provider. With his expected reacceleration, significant remaining growth runway, and a potential cyclical rebound, he believes PCOR could rerate to 45x – 50x.

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Idea Discussion

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