monday.com Ltd. (MNDY): what the price assumes

In the published model solve dated 2026-Q2, anchored at $91.40, monday.com Ltd. (MNDY) is priced for -3.4% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-27.

Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/MNDY

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The company earns no operating profit yet; the inversion runs on the revenue multiple and an assumed steady-state margin.

Solve inputs: computed at a 12% cost of capital with 4% terminal growth over a 5-year stage, holding a 35.7% terminal operating margin (89.2% gross margin x the 40% mature-conversion prior); each 1pp of cost of capital moves the implied revenue growth ~4.1pp.

How unusual the bet is: within-range (limited comparison data)

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Families that justify the price: Growth Families that call it expensive: Asset, Earnings

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.9%); the inversion above states its own rate.

Per-Model Detail (n=16)

Solvency

Operating profit is negative or near zero and the company has no demonstrated through-cycle (mid-cycle) operating margin to normalize against, so years-to-repay cannot be computed honestly.

Operating profit is negative or near zero and there is no demonstrated through-cycle (mid-cycle) operating margin to normalize against, so interest coverage cannot be computed honestly.

Bullet Takeaways

• monday.com is a work-management software platform expanding into a multi-product suite, with first-quarter revenue of $351.3 million up 24% year over year and net dollar retention of 110%, meaning existing customers spent more than they did a year earlier.
• The turn to profitability is the key development: the company posted record GAAP and non-GAAP operating income of $49 million in the quarter, a profitability inflection that changes the stock from a pure growth story to a growing-and-profitable one.
• The biggest risk is competition: monday.com is creating a software category contested by larger, better-resourced players, and the company warns rivals may "offer more attractive pricing options" and adapt faster, while its SMB-heavy base is sensitive to macro spending.

Bull Case

The striking thing about monday.com at $71.46 (June 27, 2026) is where the price sits against the methods: most of them say the stock is cheap. The growth-based cash-flow methods and the peer-multiple lens land at or above the price, and the company trades at only about 1.8 times revenue, a multiple so low it sits below what even a slow revenue decline would warrant. For a software company still growing revenue in the low-to-mid twenties percent, that is a value-stock multiple bolted onto a growth-stock business. The market is pricing monday.com as if its growth is nearly over, which the numbers contradict.

The growth is broad and increasingly profitable. First-quarter revenue rose 24% to $351.3 million, the company reported record GAAP and non-GAAP operating income of $49 million, and net dollar retention was 110%. That last number is the engine of a healthy SaaS business: existing customers expanding their spend more than offsets any churn, so revenue compounds before a single new logo is added. The expansion is moving upmarket, with record net additions of customers spending more than $500,000 a year, and 42% of recurring revenue now coming from accounts above $50,000. Larger customers churn less and expand more, so the mix shift toward enterprise strengthens the durability of the whole base.

The platform strategy and the balance sheet give the growth a long runway. monday.com has expanded from a single tool into a suite, with "monday CRM expanded from a single product into a CRM product suite, with the addition of the AI-powered monday campaigns product," and it is layering AI agents on top, with AI products already 10% of net new recurring revenue. More products sold into the same customer is the cheapest growth a software company can buy. Underpinning it all is a fortress balance sheet: roughly $1.67 billion of net cash, no debt, and positive free cash flow. The bull case is that this is a profitable, cash-rich, 20%-plus grower expanding its product surface and its customer size, priced at a multiple that assumes the growth is ending rather than continuing.

Bear Case

The competitive set is the bear's first and strongest point, because monday.com is trying to win a market that nearly everyone in software wants. Work-management and collaboration tools are offered by the largest platform companies as bundled features and by a long list of specialized startups, and monday.com itself frames its position as "creating a new category of software" that "compete[s] across multiple diffe"rent fronts. Creating a category is exciting when it works and brutal when a larger incumbent decides to give the same functionality away inside a suite the customer already pays for. The risk factors are candid that competitors "may create more compelling product offerings or offer more attractive pricing options, making it more difficult for us" to win and keep customers.

The retention trend, while still healthy, is the metric to watch and it is drifting the wrong way. Net dollar retention was 110% in the quarter, and the company itself expects it to decline modestly by the end of the fiscal year. Net retention is the heartbeat of a SaaS business; a number above 100 means the base grows on its own, but a falling trend signals either churn creeping up or expansion slowing, and at maturity that compresses the growth rate that justifies any software multiple. The customer base also skews toward small and medium businesses, which the company notes have been "negatively affected" by macroeconomic conditions, the segment most likely to cut or pause discretionary software spend in a downturn.

The valuation tension is subtler than for most growth names. The price implies the business eventually earns a roughly 36% operating margin, a level it has not yet demonstrated, even though it just turned GAAP-profitable. The asset-value lenses say expensive because return on equity is in the high single digits and the heavy stock-based compensation that funds the workforce dilutes shareholders, with the share count rising. So the bear is not that monday.com is overpriced on sales today; it is that the optionality the cheap-looking sales multiple ignores cuts both ways. If competition compresses growth and retention keeps slipping, the path to that mature 36% margin lengthens, the dilution keeps eating per-share value, and a software company growing 20% instead of 24% in a crowded category does not command a premium. The bear case is that the discount is the market correctly pricing the durability question, not missing the value.

Valuation

Because monday.com has only just turned profitable, the price is set against its sales rather than its earnings, and on that basis it is striking: the stock trades at roughly 1.8 times revenue, low enough that the price sits below what even a 5% annual revenue decline would warrant. The margin assumption embedded in the price is a roughly 36% mature operating margin, derived from the company's 89% gross margin and a conservative conversion to operating profit. The bet, in plain terms, is that monday.com keeps growing and eventually earns a normal software operating margin. At a sales multiple this modest, the price is not demanding much of either.

The methods line up unusually favorably for a software name. The growth-based cash-flow and peer-multiple lenses land near or above the price, supported by the company's record operating income and continued growth, while only the asset-value lenses say expensive. That asset-lens verdict is the usual one for a young profitable software company: book value is small, return on equity is modest, and stock-based compensation has built the business, so the balance sheet understates the franchise. The pattern, value methods skeptical, growth and earnings methods supportive, is the inverse of an overhyped growth stock. It is what a de-rated grower looks like once the multiple has already compressed.

Solvency is a strength that removes the survival question entirely. monday.com holds about $1.67 billion of net cash with no debt and generates positive free cash flow, so it can fund product development, AI investment, and the move upmarket from its own resources indefinitely. The one financial caveat is dilution: the share count is rising, driven by the stock-based compensation typical of a high-growth software firm, so per-share value has to outrun a growing denominator. The decisive question for the valuation is not the balance sheet, which is pristine, nor the current multiple, which is undemanding. It is durability: whether monday.com can hold its growth rate and net retention against well-funded competition long enough to grow into the mature margin the price assumes. If it can, the sales multiple is too low. If competition compresses the growth, the cheapness is the market pricing that risk correctly.

Catalysts

monday.com's first-quarter 2026 results paired growth with a profitability milestone. Revenue rose 24% to $351.3 million, and the company posted record GAAP and non-GAAP operating income of $49 million, with net dollar retention of 110% and broad-based outperformance across customer segments and geographies. Enterprise momentum was a highlight, with record net additions of customers spending more than $500,000 a year, and AI products already contributing 10% of net new recurring revenue.

The forward catalysts center on AI and the move upmarket. The company launched an AI Work Platform with native AI agents and a new seats-plus-credits pricing model, which is the lever it is betting will reaccelerate expansion and monetize the platform more richly. Full-year 2026 revenue guidance calls for about 19.5% growth, with some implied moderation in the second half, so the pace of deceleration is the number the market will scrutinize. The watch items are net dollar retention, which management expects to slip modestly, the traction of the new AI pricing, and the enterprise customer adds, all set against a competitive field of larger software platforms and a customer base with meaningful small-business exposure.

Peer Cohorts (Per Segment, With Filing Citations)

Core business (reported)

• HUBS (HubSpot, Inc.)
• FY2025 10-K: …prices or accept less favorable terms for our platform subscriptions in order to remain competitive. If we are unable to maintain our pricing due to competitive pressures, our margins will be reduced and our operating results will be negatively affected. Our competitors include: • cloud-based marketing automation…
• FY2025 10-K: …our business. 16 The software market in which we operate is evolving, highly competitive and significantly fragmented. With the introduction of new technologies and the potential entry of new competitors into the market, we expect competition to persist and intensify in the future, which could harm our ability to…
• KVYO (Klaviyo, Inc.)
• FY2025 10-K: …programs, such as Customer Success at Scale, Voice of the Customer, and dedicated Customer Success Managers for our largest customers. With this ongoing feedback, we can continue to make impactful improvements to our platform and to the customer experiences we offer. Competition The market in which we compete is…
• FY2025 10-K: Financial Statements. Cost of Revenue Our cost of revenue primarily consists of cloud-based infrastructure costs, outbound communication sending costs, employee-related costs including payroll, benefits, bonuses, and stock-based compensation expense related to our customer support team, amortization of capitalized…
• BRZE (Braze, Inc.)
• FY2025 10-K: …and for professional services upfront. Cost of Revenue Cost of revenue consists of direct costs related to providing platform access to our customers and to performing onboarding and professional services including consulting services. These costs primarily include payments to third-party cloud infrastructure…
• FY2025 10-K: …Teams, customers can create groups to manage individual regions or subsets of their businesses while restricting the ability of specified users to view or manage data outside of their assigned region. We also integrate with a variety of identity providers for single-sign-on or user account provisioning and provide…
• INTA (Intapp, Inc.)
• FY2025 10-K: …administrative at the consolidated level to manage the Company's operations, which are identified as significant segment expenses. Since the Company operates as a single operating and reportable segment, these significant segment expenses are the costs and expenses presented on the consolidated statements of…
• FY2025 10-K: …Many of the companies with which we compete for experienced personnel have greater resources than we have. We may incur significant costs to attract, train and retain such personnel, and we may lose new employees to our competitors or other technology companies before we realize the benefit of our investment after…
• TWLO (TWILIO INC.)
• FY2025 10-K: …on Form 10-K. Factors Affecting Our Results of Operations We are focused on innovation and durable, profitable growth. To increase revenue and grow market share, we intend to drive product innovation, leverage predictive and generative AI, further enhance our independent software vendor ("ISV"), reseller and other…
• FY2025 10-K: …reliability, deliverability, security and performance, brand awareness and reputation, the strength of sales and marketing efforts, customer support, and the cost of deploying and using products, as well as our customers' perception of the value and necessity of our products and platform. Our competitors are…
• WK (WORKIVA INC)
• FY2025 10-K: …ecosystem with integrations, and develop new solutions. We focus on customer engagement to envision the future of our platform to bring about new capabilities and versions of existing solutions to market quickly in order to remain competitive in the marketplace. Customers More than 6,600 organizations across the…
• FY2025 10-K: …affect customer demand and have a material adverse effect on our business, financial condition and results of operations. Our solutions face intense competition in the marketplace. The market for our solutions is increasingly competitive, rapidly evolving and fragmented, and is subject to changing technology and…
• CWAN (Clearwater Analytics Holdings, Inc.)
• FY2025 10-K: …certain actions with respect to the conduct of our business that we might otherwise have taken if not for the Merger Agreement. Macroeconomic and Industry Risks We operate in a highly competitive industry, with many companies competing for business from insurance companies, asset managers, hedge funds, corporations…
• FY2025 10-K: …prices of services, and this competition could hurt our financial performance and cash flows; • our results of operations and financial condition are highly dependent on fees based on the value of the assets on our platform, and for certain solutions dependent on user fees, connectivity fees, market data fees, and…
• CLBT (Cellebrite DI Ltd.)
• FY2025 20-F: …chain, hosting, salaries, other related costs to our employees and subcontractors and overhead. We expect that our gross margin will fluctuate from period to period depending on the interplay of these various factors. Operating Expenses Operating expenses consists of research and development, sales and marketing and…
• FY2025 20-F: …December 31, 2025, as compared with the year ended December 31, 2024, mainly due to an increase in hosting expenses and customer success personnel expenses. 79 Table of Content Other non-recurring Other non-recurring gross profit increased by $1.1 million, or 99%, during the year ended December 31, 2025, as compared…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.