Value
8.0/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 4.2 |
| P/S | 8.4 |
| Fwd P/E | 8.6 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 13.1x
- ▸PEG: 0.28
- ▸Attractively valued
MNDY · Why this verdict
Why monday.com (MNDY) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
monday.com combines a perfect 4-quarter earnings beat streak, a Rule of 40 score of 44, and an attractively valued forward price-to-earnings ratio of 14.3x, but a confirmed price downtrend and 17% short interest keep the technical picture weak in the near term.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
With a forward price-to-earnings ratio of 14.3x, a price-to-earnings growth ratio of 0.28, and revenue growing at 24% year-over-year, the stock trades at a discount relative to its growth rate. Valuation breakdown | Revenue growth remains above 18% year-over-year for the next 4 quarters, supporting the case that current valuation underprices the growth trajectory. | →Stable |
| CounterA forward price-to-earnings of 14.3x on a company still building toward profitability may reflect justified skepticism rather than undervaluation, particularly if growth decelerates. | ||
Free cash flow is 208% of net income, the economic moat score is wide, and the Rule of 40 reaches 44, positioning the company as a high-quality software compounder with durable competitive advantages. Quality breakdown | Free cash flow conversion remains above 150% of net income and the Rule of 40 stays above 40 over the next 4 quarters, validating the moat quality. | →Stable |
| CounterOperating margin is only 2.2 out of 10 in the scoring model, suggesting margins remain thin, and cash conversion may be inflated by favorable working capital rather than structural profitability. | ||
The company has beaten earnings estimates in all 4 of the last 4 quarters with an average positive surprise of 24%, including a 32.5% beat and a 27% beat, demonstrating consistent execution above market expectations. Earnings | The earnings beat streak extends to 6 consecutive quarters and the average surprise magnitude remains above 15% over the next two reporting periods. | →Stable |
| CounterHigh short interest of 17% suggests sophisticated investors expect the earnings trend to deteriorate, and a guidance miss could trigger a sharp decline given the stock's leverage to sentiment. | ||
The 200-day moving average slope is declining at 15.4% per month, the put/call ratio is elevated at 5.43, and short interest stands at 17% of the float, creating a heavy technical and sentiment headwind. Key risks | The stock price rises above its 200-day moving average within 6 months and short interest declines below 10%, signaling a momentum reversal. | →Stable |
| CounterHigh short interest combined with a confirmed downtrend can become self-reinforcing, and a death cross technical signal typically requires sustained fundamental improvement to reverse. | ||
With a forward price-to-earnings ratio of 14.3x, a price-to-earnings growth ratio of 0.28, and revenue growing at 24% year-over-year, the stock trades at a discount relative to its growth rate.
→StableValuation breakdown
- Expectation
- Revenue growth remains above 18% year-over-year for the next 4 quarters, supporting the case that current valuation underprices the growth trajectory.
CounterA forward price-to-earnings of 14.3x on a company still building toward profitability may reflect justified skepticism rather than undervaluation, particularly if growth decelerates.
Free cash flow is 208% of net income, the economic moat score is wide, and the Rule of 40 reaches 44, positioning the company as a high-quality software compounder with durable competitive advantages.
→StableQuality breakdown
- Expectation
- Free cash flow conversion remains above 150% of net income and the Rule of 40 stays above 40 over the next 4 quarters, validating the moat quality.
CounterOperating margin is only 2.2 out of 10 in the scoring model, suggesting margins remain thin, and cash conversion may be inflated by favorable working capital rather than structural profitability.
The company has beaten earnings estimates in all 4 of the last 4 quarters with an average positive surprise of 24%, including a 32.5% beat and a 27% beat, demonstrating consistent execution above market expectations.
→StableEarnings
- Expectation
- The earnings beat streak extends to 6 consecutive quarters and the average surprise magnitude remains above 15% over the next two reporting periods.
CounterHigh short interest of 17% suggests sophisticated investors expect the earnings trend to deteriorate, and a guidance miss could trigger a sharp decline given the stock's leverage to sentiment.
The 200-day moving average slope is declining at 15.4% per month, the put/call ratio is elevated at 5.43, and short interest stands at 17% of the float, creating a heavy technical and sentiment headwind.
→StableKey risks
- Expectation
- The stock price rises above its 200-day moving average within 6 months and short interest declines below 10%, signaling a momentum reversal.
CounterHigh short interest combined with a confirmed downtrend can become self-reinforcing, and a death cross technical signal typically requires sustained fundamental improvement to reverse.
Per-dimension breakdown
Quality
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 4.3 |
| ROA | 0.2 |
| Gross margin | 10.0 |
| Op margin | 2.2 |
| Net margin | 4.6 |
| Current ratio | 6.2 |
| FCF quality | 10.0 |
| Moat | 8.4 |
| Rule of 40 | 7.4 |
| Piotroski F | 10.0 |
- ▸Excellent cash conversion: 208% FCF/NI
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
- ▸Rule of 40: 44 (pass)
Growth
6.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 8.6 |
| EPS growth | 3.9 |
- ▸Strong growth: 24% YoY
Momentum
1.0/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 1.0 |
| Volume | 0.0 |
- ▸Capitulation risk (RSI 4, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -13.8%/30d — confirmed downtrend
Sentiment
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.5 |
| Price target | 9.7 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 58%
Insider
5.2/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.3 |
- ▸Insider selling (low materiality) — $384,293 (0.011% of mkt cap)
Peer rank
4.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.1 |
| quality rank | 5.5 |
| growth rank | 7.1 |
Technical
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.7 |
| support resistance | 9.9 |
| 52w position | 0.0 |
| gap | 6.0 |
Risk (lower is worse)
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.7 |
| days to cover | 7.4 |
| volatility | 0.0 |
| put call | 0.0 |
| implied vol | 0.7 |
| max pain risk | 3.0 |
| beta | 6.1 |
| debt equity | 9.1 |
- ▸High short interest: 17%
- ▸Elevated put/call: 2.09
- ▸High IV: 76%
- ▸Above max pain $55
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (7)
- ASYMMETRY:3.6>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:46d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:1.0<4.5
- DEATH_CROSS:HARD_BLOCK
Warning (0)
none
Reward-to-Risk
3.59
Upside
+42.6%
Downside
11.9%
Sizing output
AVOID
SetupFALLING_KNIFE — Death cross, below all MAs, RSI 4, MACD bearish
EdgeNO_EDGE — No clear edge identified
SuitabilityAGGRESSIVE — MCap $3.7B<$5B
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: ASYMMETRY:3.6>=1.5. Top dim: Value at 8.0; weakest: Momentum at 1.0. No conviction either direction.
The strongest dimensions are Value at 8.0, Sentiment at 7.5, and Catalyst at 7.5; the weakest are Momentum at 1.0, Risk (lower is worse) at 3.5, and Peer rank at 4.4. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 3.59 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The company has beaten earnings estimates in all 4 of the last 4 quarters with an average positive surprise of 24%, including a 32.5% beat and a 27% beat, demonstrating consistent execution above market expectations.
Trip ifEarnings miss by more than 10% in any 1 of the next 2 quarters, breaking the streak below 4 consecutive beats.
- P2Free cash flow is 208% of net income, the economic moat score is wide, and the Rule of 40 reaches 44, positioning the company as a high-quality software compounder with durable competitive advantages.
Trip ifFree cash flow conversion falls below 100% of net income for 2 consecutive quarters.
- P3With a forward price-to-earnings ratio of 14.3x, a price-to-earnings growth ratio of 0.28, and revenue growing at 24% year-over-year, the stock trades at a discount relative to its growth rate.
Trip ifRevenue growth falls below 15% year-over-year for 2 consecutive quarters.
- P4The 200-day moving average slope is declining at 15.4% per month, the put/call ratio is elevated at 5.43, and short interest stands at 17% of the float, creating a heavy technical and sentiment headwind.
Trip ifShort interest rises above 20% of float or the stock price declines below $65, representing more than 15% downside from current levels.