Company Analysis: Light Speed

 Lightspeed POS, Inc. provides point-of-sale software for retailers and restaurants. It offers workflow analysis, training, configuration, networking and business services. The company was founded by Dax Dasilva on March 21, 2005 and is headquartered in Montreal, Canada.

 

Competitors: Shopify, Square

Lightspeed does not get as much organic growth as Shopify does given its size. They just acquire acquire and keeping acquiring….dilute and acquiring

Company Analaysis: Z-Scaler

 ZScaler(ZS) is a cybersecurity company that focuses on zero-trust cloud security. The technology allows finer control of the enterprise customers to grant data access to employees depending on context and content. The context dependency enhances the data security since more and more cyber-attacks implants backdoor virus in employees or collaborators' devices.  

Along with the Covid-19 pandemics, the work-from-home trend exposed that the old cyber security measures can't to deal with the threat of loss/stolen/hacked remote devices.

 

 

High Growth  

The company is growing fast during the last TTM and YoY. The optimistic uptrend supports the above-market stock price performance. The P/S is higher than its competitors, but the 80/20 rule tell us winner keep winning.  The current valuation is based on 40% revenue YoY growth. For a software company, the revenue grow doesn't increase cost. The margin will keep increasing. The EPS estimator the next year is 103.77%

 

	2020 (07/31/20)	2019 (07/31/19)	2018 (07/31/18)	2017 (07/31/17)	2016 (07/31/16)
profit(M)	356	254	160	105	65
cost(M)	75	49	30	21	15
margin(%)	0.789	0.807	0.812	0.8	0.769

Valuation

Compare to other growth Stocks, SZ is expensive.

Customer Concentration

Federal Government