Value
4.6/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 2.8 |
| Fwd P/E | 2.4 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 48.4x
- ▸PEG: 0.02
MDB · Why this verdict
Why MongoDB (MDB) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Revenue expanding at 25% per year, paired with four consecutive earnings beats averaging approximately 36% above consensus, demonstrates that demand for the platform continues to outrun market expectations. Growth breakdown | Revenue growth remains above 20% per year for the next four quarters, keeping the company inside the top-tier growth cohort. | →Stable |
| CounterPlatform growth at this scale can decelerate sharply if large enterprise migrations slow or if consumption-based pricing makes revenue harder to forecast reliably; the outsized surprises could reflect a catch-up from prior under-modeling rather than a sustainably higher growth trajectory. | ||
A 20% free-cash-flow margin and a rule-of-40 score of 45 demonstrate that the business converts growth spending into real cash, offering a more durable financial foundation than the GAAP income statement alone would suggest. Quality breakdown | Free-cash-flow margin expands above 25% over the next 12 months, narrowing the divergence between GAAP results and cash generation. | →Stable |
| CounterFree-cash-flow margin is sensitive to working-capital timing and stock-based compensation treatment; if growth investment ramps further, cash generation could compress even as revenue grows. | ||
With 73% of revenues tied to a single cloud database offering, a slowdown in adoption, a pricing-model shift, or competitive displacement in that segment would disproportionately impair the business. Bear case | Non-cloud-database product revenues grow faster than the flagship offering over the next 12 months, gradually reducing the revenue share concentrated in one product. | →Stable |
| CounterDeep product concentration is common in early-stage infrastructure companies and often reflects the strength of a leading product rather than fragility; the flagship offering may grow fast enough that diversification is unnecessary in the near term. | ||
At a forward earnings multiple of 48.3x, the valuation screens in the bottom tier of the peer group, and with only 2.5% upside to the analyst price target the current entry point exposes the investor to multiple compression with little room to earn a return. Valuation breakdown | The forward multiple compresses to below 35x over the next 12 months as earnings growth outpaces price appreciation, bringing valuation closer to a level consistent with the growth profile. | →Stable |
| CounterHigh-growth infrastructure software businesses routinely sustain rich multiples for years when the growth runway is long and the product proves essential to enterprise operations; a 48x multiple may be justified if 25% growth continues for several more years. | ||
Revenue expanding at 25% per year, paired with four consecutive earnings beats averaging approximately 36% above consensus, demonstrates that demand for the platform continues to outrun market expectations.
→StableGrowth breakdown
- Expectation
- Revenue growth remains above 20% per year for the next four quarters, keeping the company inside the top-tier growth cohort.
CounterPlatform growth at this scale can decelerate sharply if large enterprise migrations slow or if consumption-based pricing makes revenue harder to forecast reliably; the outsized surprises could reflect a catch-up from prior under-modeling rather than a sustainably higher growth trajectory.
A 20% free-cash-flow margin and a rule-of-40 score of 45 demonstrate that the business converts growth spending into real cash, offering a more durable financial foundation than the GAAP income statement alone would suggest.
→StableQuality breakdown
- Expectation
- Free-cash-flow margin expands above 25% over the next 12 months, narrowing the divergence between GAAP results and cash generation.
CounterFree-cash-flow margin is sensitive to working-capital timing and stock-based compensation treatment; if growth investment ramps further, cash generation could compress even as revenue grows.
With 73% of revenues tied to a single cloud database offering, a slowdown in adoption, a pricing-model shift, or competitive displacement in that segment would disproportionately impair the business.
→StableBear case
- Expectation
- Non-cloud-database product revenues grow faster than the flagship offering over the next 12 months, gradually reducing the revenue share concentrated in one product.
CounterDeep product concentration is common in early-stage infrastructure companies and often reflects the strength of a leading product rather than fragility; the flagship offering may grow fast enough that diversification is unnecessary in the near term.
At a forward earnings multiple of 48.3x, the valuation screens in the bottom tier of the peer group, and with only 2.5% upside to the analyst price target the current entry point exposes the investor to multiple compression with little room to earn a return.
→StableValuation breakdown
- Expectation
- The forward multiple compresses to below 35x over the next 12 months as earnings growth outpaces price appreciation, bringing valuation closer to a level consistent with the growth profile.
CounterHigh-growth infrastructure software businesses routinely sustain rich multiples for years when the growth runway is long and the product proves essential to enterprise operations; a 48x multiple may be justified if 25% growth continues for several more years.
TrendMatrix Research · core thesis
Engine thesis — one sentence
MongoDB sustains 25% revenue growth and generates a 20% free-cash-flow margin despite reporting GAAP losses — a combination that clears the rule-of-40 benchmark at 45 with four consecutive earnings beats — but a forward multiple of 48.3x and only 2.5% upside to the analyst price target leave no margin for error at current prices.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 10.0 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 8.1 |
| FCF quality | 7.0 |
| Moat | 5.8 |
| Rule of 40 | 7.6 |
| Piotroski F | 6.7 |
- ▸FCF-positive despite GAAP loss (FCF margin 20%, FCF yield 1.8%)
- ▸Rule of 40: 45 (pass)
Growth
8.8/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 8.8 |
- ▸Strong growth: 25% YoY
Momentum
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 3.1 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.5 |
| Price target | 6.6 |
| erm sentiment | 5.0 |
Insider
3.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.1 |
- ▸Notable insider selling — $51,275,712 (0.180% of mkt cap)
Peer rank
4.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 1.7 |
| quality rank | 2.4 |
| growth rank | 6.5 |
Technical
4.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.1 |
| support resistance | 3.5 |
| 52w position | 6.0 |
Risk (lower is worse)
4.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.6 |
| days to cover | 9.6 |
| volatility | 0.0 |
| put call | 6.4 |
| implied vol | 0.0 |
| beta | 4.8 |
| debt equity | 3.0 |
- ▸High IV: 80%
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
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
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:7.5>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:54d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.1<1.5@spot
Warning (0)
none
Reward-to-Risk
0.15
Upside
+2.3%
Downside
15.0%
Sizing output
AVOID
SetupMomentum Cont — Trend continuation, RSI 50, MACD bullish
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — Beta 1.55>1.3
Investment implication
The F-path SELL output reflects an overall score of 4.7 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 8.8) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.1<1.5@spot) reinforce the read. Current asymmetry R:R is 0.15 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 8.8, Momentum at 7.5, and Catalyst at 7.5; the weakest are Insider at 3.4, Technical at 4.2, and Peer rank at 4.2. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 0.15 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Durable Double Digit Revenue Growth
Trip ifRevenue growth falls below 15% YoY for 2 consecutive quarters, signaling a meaningful deceleration in the growth engine.
- P2Fcf Profitability Despite Gaap Losses
Trip ifFree-cash-flow margin falls below 10% for 2 consecutive quarters, indicating cash generation has deteriorated.
- P3Stretched Valuation Leaves No Margin
Trip ifForward P/E compresses below 30x as earnings growth outpaces the share price, removing the valuation-risk overhang.
- P4Single Product Cloud Concentration
Trip ifCloud database offering's share of total revenues falls below 60%, indicating meaningful product-mix diversification has occurred.