nCino, Inc. (NCNO): what the price requires
At today's price, nCino, Inc. (NCNO) is priced for today's economics sustained for ~16.8 years. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-17 · Source: https://boothcheck.com/report/NCNO
Headline
| Field | Value |
|---|---|
| Ticker | NCNO |
| Company | nCino, Inc. |
| Current price | $17.37/sh |
| Composition | United States - Subscriptions - non-mortgage 56% / United States - Subscriptions - mortgage 13% / United States - Professional services and other 8% / International - Subscriptions 18% / International - Professional services and other 4% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 5.6% |
| Operating margin today | 3.6% |
| Margin expansion implied | +2.0pp |
| Must persist for | 16.8y |
| Multiple paid | 97x operating income |
The operating-margin requirement is derived from the framework's value band at year 7, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 10.1% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~2.5 years.
How unusual the bet is: high
| Reference | Value |
|---|---|
| vs own history | -0.24σ |
| cohort percentile (of 177 peers) | 99 |
| sustained it ~10 years at this level | 15% |
| implied end-window share | 0% |
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.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 11.13x | 3 | expensive |
| Earnings | 6.27x | 4 | expensive |
| Relative | 1.53x | 5 | expensive |
| Growth | 0.80x | 3 | justifies |
Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.2%); the inversion above states its own rate.
Per-Model Detail (n=15)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $28.85 | 0.60x | yes | FCF base $0.1B, growth 10% (input: historical growth), terminal g 4.0%, WACC 8.2%, 6yr projection |
| DCF Exit Multiple | Growth | $21.78 | 0.80x | yes | Exit EV/EBITDA: 28.7x / 30.7x / 32.7x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $11.32 | 1.53x | yes | P/E 67.52x (blended: static sector reference 35x + trailing (TTM) 143x), scenarios: 56.0x / 67.5x / 79.1x (bear / base = reference held flat / bull), EV/EBITDA 25x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $1.31 | 13.26x | yes | BV/sh $8.87, ROE (TTM) 1.4%, ke 9.3% |
| Two-Stage Excess Return | Asset | $0.71 | 24.46x | yes | 5yr excess ROE then converge to ke=9.3% (excluded from median) |
| Discounted Future Market Cap | Growth | $15.12 | 1.15x | yes | Rev $0.6B, growth 10% (input: historical growth; tapered), Terminal P/S: 2.6x / 3.1x / 3.6x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $1.44 | 12.06x | yes | EPS $0.12, growth 1% (input: historical EPS growth), PEG=120.34 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | — | — | no | — |
| Residual Income | Asset | $0.51 | 34.06x | yes | BV $8.87 + 5yr PV of (ROE (TTM) 1.4% − Kₑ 9.3%) × BV; BV grows 0.9%/yr (excluded from median) |
| Graham Number | Asset | $4.89 | 3.55x | yes | √(22.5 × EPS $0.12 × BVPS $8.87) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $13.86 | 1.25x | yes | EBITDA $0.07B × sector EV/EBITDA 25.0x |
| FCF Yield | Earnings | $9.27 | 1.87x | yes | FCF $110.8M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $2.16 | 8.04x | yes | SBC-adj FCF $0.04B (FCF $0.11B − SBC $0.07B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $3.87 | 4.49x | yes | EPS $0.12 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $1.56 | 11.13x | yes | BV $8.87 × (ROIC 1.4% / WACC 8.2%) |
| P/Sales Sector | Relative | $44.59 | 0.39x | yes | Revenue $0.61B × sector P/S 8.0x |
| PEG Fair Value | Relative | $4.50 | 3.86x | yes | EPS $0.12 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $1.30 | 13.36x | yes | EPS $0.12 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $210.9m |
| Net debt / NOPAT (after-tax) | 12.12x |
| Net debt / operating income (pre-tax) | 9.57x |
| Interest coverage | 1.2x |
| Share count CAGR (buyback) | -0.1% |
| Burning cash | no |
Bullet Takeaways
nCino sells cloud banking software to financial institutions, mostly on subscription, split across non-mortgage, mortgage, and international lines. At $14.81 (June 27, 2026) the price pays about 84x company-wide operating income on a thin 4.3% operating margin, which implies growth held at the self-funding ceiling for roughly 15 years.
The static valuation families call the stock richly valued; only the forward growth method reaches the price. So the quote is a durability bet, and the central risk is that subscription growth is decelerating, from the mid-teens toward roughly 9% in current-year guidance, even as the multiple still prices long-duration compounding.
The balance sheet carries modest leverage: net debt around $211 million against thin trailing operating income, with interest coverage near 1.5x. The business is now profitable on a small base, but it does not yet generate the cash the valuation extrapolates.
Bull Case
Start with the bear's strongest point, because the bull case only works if it survives it: at about 84x operating income on a 4.3% margin, the price assumes ceiling-rate growth for roughly 15 years, and growth is visibly slowing. The question is whether the data supports the fear that nCino is a decelerating SaaS name dressed in a hyper-growth multiple, or whether it undermines it. On balance the recent results undermine the most extreme version of the fear: in the most recent quarter total revenue rose 11% to $159.4 million and subscription revenue rose 12% to $140.9 million, and the company raised its current-year subscription outlook to $517.5 million. Double-digit subscription growth with rising guidance is deceleration from a high base, not a stall.
The quality of the revenue is the bull's anchor. nCino is overwhelmingly a subscription business, and subscription revenue is recurring and contracted, the most durable kind of software revenue. The mortgage line, often dismissed as cyclical, grew 22% year over year in a recent quarter, showing the platform gains share even when the underlying lending market is soft. A vendor whose software sits inside banks' core lending workflows has high switching costs, which is the structural reason the growth-DCF frame is the one method that reaches the price: the durability the static frames cannot capture is exactly the stickiness of mission-critical banking software.
The forward driver is the move into AI. nCino has integrated AI across its platform, with over 80 customers already purchasing its Banking Advisor technology. For an installed base of financial institutions, an AI layer is both a new revenue line and a retention tool, because it deepens the product's role in the customer's daily operations. If Banking Advisor and related AI features lift net retention back up and re-accelerate subscription growth, the 15-year durability bet the price is making becomes far more plausible, and the company is now profitable enough that incremental growth drops toward the bottom line rather than funding losses.
Bear Case
The most fragile assumption in the price is net revenue retention, the engine that lets a subscription business compound, and the filing shows it has already moderated. nCino disclosed that its subscription revenue net retention rate declined in fiscal 2025, driven by the expiration of licenses tied to Paycheck Protection Program loan-forgiveness monitoring and by the acquisition of certain customers by entities that do not use its solutions (FY2025 10-K, accession 0001902733-25-000026). Net retention is the multiplier on a SaaS model: when existing customers expand faster than they churn, growth compounds; when retention slips, the company must win new logos just to stand still. A multiple pricing 15 years of ceiling growth cannot tolerate a retention rate drifting the wrong way.
The second soft spot is the growth trajectory itself. Subscription growth has stepped down from around 15% to roughly 12%, and full-year guidance implies about 9% total revenue growth. That is a clear deceleration curve, and at 84x operating income the price is extrapolating a re-acceleration or a very long plateau that the trend does not yet support. The asset and earnings-power families both flag the stock as richly valued for this reason: the current 4.3% operating margin is far below what the price needs, and only the single growth-DCF method, which assumes the durable compounding plays out, reaches the quote.
The valuation leaves no cushion if the AI and retention story underdelivers. History says only about 15% of comparable fast-growers sustained this pace for even a decade, and the price asks for fifteen years. The balance sheet adds a smaller constraint: net debt near $211 million against thin operating income means interest coverage around 1.5x, so the company has limited room to fund a turnaround through leverage. The bear case is not insolvency, it is a re-rating: if growth keeps decelerating and net retention does not recover, a stock priced for long-duration compounding compresses toward what the static methods say it is worth, which is well below the current price.
Valuation
At the current price the market is paying about 84x company-wide operating income, which implies operating growth held at its self-funding ceiling for roughly 15 years. The solve runs at a cost of capital near 9.9% with growth searched up to a 25% ceiling, and each additional point of growth moves the implied horizon by about 2.4 years. These are approximate figures from a single inversion under fixed fade assumptions, not measured forecasts, and the 15-year horizon is the heart of the demand the price makes.
The family pattern is decisive. The asset, earnings-power, and peer-multiple methods all read richly valued, and only the forward growth-DCF reaches the price. When three frames sit well below the quote and one stretches to meet it, the price is a bet on durable compounding the static methods structurally cannot capture, the moat-and-durability premium of mission-critical banking software. The reverse-DCF range on a whole-company basis centers far below the current price with an acceptable reliability flag, which quantifies how much of the quote rests on the growth assumption alone.
The grounding is mixed. On the bull side the near-term pace is within what nCino has recently delivered, so the stretch is in how long it must persist rather than the rate. On the bear side, the historical base rate is harsh: only about 15% of comparable fast-growers sustained this level for ten years, and the price asks for fifteen. The current 4.3% operating margin is well short of a level that would justify the multiple on earnings, so the entire case depends on the subscription engine re-accelerating and margins scaling. The valuation is reasonable only if you underwrite the long-duration growth; on any conservative frame it is full.
Catalysts
The most recent print, Q1 fiscal 2027 (quarter ended April 30, 2026), showed total revenue of $159.4 million, up 11%, and subscription revenue of $140.9 million, up 12%. The prior quarters traced a similar path: Q2 fiscal 2026 total revenue of $148.8 million, up 12%, with subscription revenue up 15% and US mortgage subscription revenue up 22%. Full-year fiscal 2026 guidance pointed to total revenue of $585 million to $589 million, roughly 9% growth, with subscription revenue raised toward $517.5 million.
The key forward driver is the AI rollout. nCino has integrated AI across its platform and reported over 80 customers purchasing its Banking Advisor technology, and the pace of AI adoption and its effect on net revenue retention is the catalyst most likely to either re-accelerate growth or confirm the deceleration. Mortgage-market conditions are a secondary swing factor for the mortgage subscription line.
The watch items are net revenue retention, the trajectory of subscription growth against the roughly 9% guide, and operating-margin expansion from the current low base. A re-acceleration in subscription growth and a recovery in net retention, helped by AI attach, would support the long-duration thesis the price assumes; continued deceleration would pressure a valuation built on it. Sources: nCino fiscal 2026 and 2027 results and guidance (investor.ncino.com; finance.yahoo.com; investing.com; seekingalpha.com), 2026.
Peer Cohorts (Per Segment, With Filing Citations)
Cloud banking software (nCino Platform) (reported)
- ALKT (ALKAMI TECHNOLOGY, INC.)
- (no filing in the citation store)
- VERX (Vertex, Inc.)
- (no filing in the citation store)
- TENB (TENABLE HOLDINGS, INC.)
- (no filing in the citation store)
- PCOR (Procore Technologies, Inc.)
- (no filing in the citation store)
- BL (BlackLine, Inc.)
- (no filing in the citation store)
- CWAN (Clearwater Analytics Holdings, Inc.)
- (no filing in the citation store)
- SAIL (SailPoint, Inc.)
- (no filing in the citation store)
- MNDY (monday.com Ltd.)
- (no filing in the citation store)
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.