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Atlassian IPO, Independent research on Atlassian, independent research on IPOs, Independent Stock Research, Internet Equity Research, IPO Research, recent IPO research, Software Stocks, Stock Research, Technology Stock IPOs, The Battle Road IPO Review

Atlassian: Team Player

Atlassian logoOne of the more intriguing enterprise software IPOs of the last number of months is Atlassian (NASDAQ: TEAM), a company which focuses on team-oriented custom software development. Founded in Sydney, Australia in 2002, the company is led by co-CEOs Mike Cannon-Brookes and Scott Farquhar.  Fiscal Year 2016 (ending June 30th) Consensus revenue and EPS estimates call for $458 million and $0.33. This implies revenue growth of 40 percent over fiscal year 2015, though we note that the company executed a couple of tuck-in acquisitions in that year.

Atlassian made its debut on the NASDAQ on December 10, 2015, at a price of $21.00 per share.  The offering featured 22 million Class A common shares, all of which came from the company, enabling it to raise roughly $430 million. Investment banks Goldman Sachs and Morgan Stanley were the lead underwriters of the stock offering, with Allen & Company, UBS Securities, and Jefferies, Canaccord Genuity, JMP Securities, Raymond James, and William Blair all fighting for a share of the IPO pot. Atlassian, recently trading in the vicinity of $22, carries a market cap of roughly $4.7 billion.

Atlassian’s mission calls for the power to “unleash the potential in every team,” in this case software developer teams focused on customized software for corporations, government agencies and non-profits. Each of the more than 20 software products offered by Atlassian helps teams complete, organize, and discuss their work. Atlassian offers a portfolio of software tools that include JIRA, for team planning and product management, Confluence, for team content creation and sharing, HipChat, for team messaging and communication, Bitbucket for team code sharing and management, and JIRA Service Desk, for team services and support applications.

Atlassian’s products are built for teams of all sizes, and are utilized in almost every industry.  Atlassian boasts over five million monthly users, and over 57,000 customers, including 79 of the Fortune 100, and 273 of the Fortune 500.  Roughly 30 percent of sales comes from subscriptions, 50 percent from maintenance, 15 percent from perpetual licenses, and five percent from other.

Post-IPO, Atlassian has a strong balance sheet with over $700 million in cash, and no debt. To learn more about how Atlassian screens relative to its software peers, please contact Battle Road Research.

Mimecast
independent research on IPOs, Independent Stock Research, Internet Stocks, IPO Research, Mimecast IPO, recent IPO research, Software Equity Research, Software IPOs, Stock Research, The Battle Road IPO Review

Mimecast: Keeping Corporate Email Safe from Attack

MimecastFounded in 2003 by Peter Bauer, currently CEO and Chairman, and Neil Murray, currently Chief Technology Officer, and based in London, the UK, Mimecast (NASDAQ: MIME) is a leader in cloud-based email management, including data security and archiving. The company serves over 18,000 customers in a broad range of industries, and added 1,800 new customers in the recently concluded March 31 quarter. Consensus estimates call for revenue of $173 million in fiscal year 2017 (ending March 31), which implies a 22 percent increase over the prior year, while EPS estimates suggest a loss of $0.05 per share, which would compare to a loss of $0.07 in FY’2016.

Mimecast debuted on the NASDAQ on November 19, 2015 in a 7.8 million share IPO priced at $10 per share that enabled the company to raise about $70 million. The deal was led by Goldman Sachs, Barclays Capital, Jeffries, RBC Capital Markets, and Oppenheimer and Company. At a recent share price of $9, Mimecast’s market cap is roughly $475 million.

Mimecast offers a wide range of archiving and data security services that enhance corporate email systems with additional features for storing and retrieving emails, as well as an additional layer of protection for corporate email users, such as those running Microsoft Office 365. Roughly 60 percent of revenue is derived from channel partners, rather than a direct sales force. The company’s customers are based principally in three countries, with the U.K. accounting for 42 percent of sales, the US 38 percent, and South Africa 19 percent.

The company’s email archiving and threat protection services are derived from a broad range of industries, including legal services (17 percent), professional, scientific and technical services (14 percent), manufacturing (13 percent), and finance and insurance (12 percent), with no customer accounting for more than one percent of sales.  The company claims a greater than 90 percent plus retention rate among customers for its services. Mimecast competes against a broad range of competitors, including Microsoft through its Exchange Server offering, Barracuda Networks (NYSE: CUDA), Symantec (NASDAQ: SYMC), and Proofpoint (NASDAQ: PFPT).

Mimecast’s net cash position post IPO is $126 million, and the company is generating cash from operations. To learn more about how Mimecast screens relative to its software peers, please contact Battle Road Research.