chatSBC
Equity & Macro Commentary, Technology Investing
MongoDB is an easy funding short because of its high multiple and a squishy last quarter, regardless of long-term fundamentals; in this tape, anything short of a clean beat is squishy. A post the author replies to argues Atlas grew 29% against expectations of 30%, roughly in line after adjusting for a large hybrid contract. x.com x.com
MongoDB's CEO CJ Desai leaving after less than a year for a non-CEO role, even at Meta, is a red flag that raises the question of what he knows. It comes the same week as the company's investor day and makes its large correction less appealing to buy. Merely reaffirming guidance this far into the quarter may also disappoint, even though its consumption-model guide is conservative and should be comfortably surpassed. x.com x.com
MongoDB faces a de-rating risk if Atlas growth slows, because buy-side models assume too much. Atlas is about 75% of the business, and most buy-siders model 33-35% growth plus more on top. Management's guide of 26% is conservative and growth has not slowed yet, but if it does, revised models and higher yields would hit the stock hard; it may move to the sidelines for the next two quarters. @kawhisnake counters that RPO and current RPO are growing strongly. x.com x.com
MongoDB is one of the better-positioned names in software because every AI agent interaction drives database activity. It should capture some non-zero share of that massive market. CJ's departure is just about securing the bag and shouldn't be read into further. x.com
MongoDB's leadership churn undermines its turnaround. Per Wall St Engine, CEO CJ Desai stepped down effective immediately for a senior role at Meta, with founder and former CEO Dev Ittycheria returning as interim CEO, though MongoDB reaffirmed its Q3 and FY27 guidance. Dev quit halfway through the 3.0 transformation, and CJ did not even last the year. x.com
MongoDB should probably trade closer to 6-7x forward revenue instead of 9-10x, since the premium multiple it carried, perhaps because of its CEO, is being taken away. x.com
Most rivals cannot match these 12 stocks' moats. Micron is one of three HBM titans; Circle backs USDC; ASML alone makes EUV; Planet Labs has the largest Earth-imaging fleet. MongoDB is developers' choice; Affirm embeds at Amazon and Shopify; Eli Lilly leads GLP-1; SoFi spans loans, banking and investing. On gains via CloudTec; AST SpaceMobile builds phone satellites; Rigetti offers cloud quantum computing; Spotify, the largest music streamer, adds podcasts and audiobooks. x.com x.com x.com x.com … Show more
MongoDB looks expensive against its sales: at 10x next year's sales, versus the 5x software companies usually get, it trades 67% above the high end of a $216–$276 fair range, which is 5x next year's sales, give or take 12%. This is a valuation read only, with no fundamental work. x.com
Snowflake, Rubrik, Samsara and MongoDB have become far too bubbly to buy. Microsoft and Meta Platforms were the only good values left in tech. x.com
MongoDB's after-hours drop is worth taking the other side of, because the Atlas shortfall is a comp, not a demand problem. Q2 revenue rose 30% to $771.8M, about $38M above estimates; EPS was $1.90 versus $1.61; RPO rose 91% and cRPO 73%; free cash flow nearly doubled to $137.6M; and non-GAAP operating margin rose 900bps to 24%. The full-year guide went up, mostly on Atlas. Shares fell about 12% because Atlas grew 29% against a 30% whisper. Better to own the backlog than the bogey. x.com
Microsoft is one of the only good values left in tech, while names such as Snowflake, Rubrik, Samsara and MongoDB look far too bubbly. If the stock simply returns to its highs, the gains are straightforward. x.com
