pixdeluxe/E+ via Getty Images Investment Thesis Grid Dynamics Holdings, Inc. (NASDAQ: GDYN ) is down 19% YTD as investors remain concerned about Grid Dynamics’ vulnerability to the weak macro environment that has been present for the past six months. The company’s guidance for the second quarter fell well below estimates, indicating a mid-single-digit sequential decline in revenue. However, it is worth noting that Grid Dynamics continues to onboard new clients at a healthy pace, which sets the stage for promising medium-term growth and a more diversified revenue base. The addition of new clients is encouraging, and it will be important to closely monitor disclosures related to client penetration metrics in the near term. Overall, I remain bullish on the company’s long-term growth trajectory and keep an end-of-year price target of $13 derived from a 25x multiple applied to the consensus CY24E EPS of $0.53. Q1 2023: Weak Macro Reflecting in Results The company’s Q1 revenue and adjusted EBITDA came modestly ahead of market estimates, although the Q1 represents the smallest revenue beat to guidance and street estimates, indicative of a weak demand environment. The demand for IT services in project-based work is currently at its weakest since 2008/09, which […]
K&X Design and Investment Technology, LLC
Invest The Invisible Impact
K&X Design and Investment Technology, LLC
Invest The Invisible Impact
