SENTINELONE, INC (S): what the price assumes

In the published model solve dated 2026-Q2, anchored at $21.00, SENTINELONE, INC (S) is priced for today's economics sustained for ~10.2 years. 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 2026-06-28.

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

Headline

FieldValue
TickerS
CompanySENTINELONE, INC
Current price$21.00/sh
CompositionU.S. 61% / International 39%

What The Price Assumes (Inversion)

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

FieldValue
Inversion basisrevenue-multiple
EV / sales paid6.6x
Steady-state operating margin assumed29.6%
Must persist for10.2y

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 12.9% cost of capital; growth searched up to the 25% self-funding ceiling; each 1pp moves the implied horizon ~2 years.

Reconcile: at the x-ray's 9.3% required return this reads ~19.9%/yr; the models below use their own rates.

How unusual the bet is: elevated

ReferenceValue
vs own history-1.27σ
sustained it ~10 years at this level15%
implied end-window share0%

Valuation X-Ray

The price is justified by relative-multiple; asset-based/earnings-power land below the price.

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.

FamilyMedian price/FVModelsReads
Asset5.19x2expensive
Earnings12.28x1expensive
Relative0.84x2justifies
Growth1.30x3expensive

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

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.1%); the inversion above states its own rate.

Per-Model Detail (n=8)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$6.723.12xyesFCF base $0.1B, growth 21% (input: historical growth), terminal g 4.0%, WACC 9.1%, 7yr projection
DCF Exit MultipleGrowth$0.00—noNegative/zero FCF or EBITDA — equity value floored at $0
Relative ValuationRelative$24.900.84xyesP/S fallback (negative EPS): Sector P/S 8.0x × TTM revenue — excluded from consensus
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$4.274.92xyesBook value floor: BV/sh $4.27, ROE negative
Two-Stage Excess ReturnAsset$3.845.47xyesBook value with convergence: BV/sh $4.27, ROE converges to ke
Discounted Future Market CapGrowth$24.510.86xyesRev $1.0B, growth 21% (input: historical growth; tapered), Terminal P/S: 5.5x / 6.7x / 8.0x (bear / base = today's held flat / bull, cap 12x)
Peter Lynch Fair ValueRelative$0.00—noNegative/zero EPS — earnings-based value floored at $0
Margin TrajectoryGrowth$16.191.30xyesMargin ramp: -30% → 22% over 7yr, rev growth 21% (input: historical growth; tapered)
Earnings Power ValueEarnings——no—
Residual IncomeAsset——no—
Graham NumberAsset——no—
EV/EBITDA RelativeRelative——no—
FCF YieldEarnings$1.7112.28xyesFCF $61.8M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings——no—
Ben Graham FormulaEarnings——no—
ROIC-Justified P/BAsset——no—
P/Sales SectorRelative$24.900.84xyesRevenue $1.05B × sector P/S 8.0x
PEG Fair ValueRelative——no—
Earnings YieldEarnings——no—
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Economic-Unit Decomposition (Sum Of The Parts)

Only one reportable economic unit is present in the current topology source. Consolidated operating lenses remain available, but there is no multi-unit decomposition.

UnitRoleValuation basisRevenueReported profitValue evidenceStatus
SentinelOne (consolidated)operatingenterprise0.8B reported-currency—withheldunresolved no unit value

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

FieldValue
Net cash$656.8m
Share count CAGR (dilution)5.7%
Burning cashno

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

Bull Case

The structural advantage SentinelOne is pressing is an AI-native architecture in a security market that is consolidating onto platforms. The FY2025 10-K describes an "AI and automation driven approach to cybersecurity" that "has been adopted by some of the world's largest organizations," which is why "we have grown rapidly since our inception" (accession 0001583708-25-000051). That positioning is showing up in the product mix: Purple AI, the autonomous-analyst layer, reached a record 50% attach rate on licenses sold in the most recent quarter, and emerging products including cloud, data analytics, and threat services now represent over half of annual bookings (web research). A platform whose newest, highest-value modules attach to a large existing base is the financial picture of a widening moat, not a single-product point tool.

The economics under that moat are turning the corner the bears doubted. The company crossed $1 billion in annual revenue and reached full-year operating profitability, with operating margin expanding more than 600 basis points year over year, while gross margin sits near 74% (web research). Revenue for fiscal 2025 was $821.5 million versus $621.2 million the prior year, and the recent quarter showed revenue up 21% to about $277 million with annualized recurring revenue up 23% to roughly $1,163 million (accession 0001583708-25-000051, web research). Customers with $100,000 or more of ARR grew 17%. That combination, revenue past 20% growth with margins inflecting, is exactly the shape a 3.6x-revenue multiple needs to justify, and the company is delivering both at once.

The balance sheet removes the usual story-stock fragility. SentinelOne carries about $657 million in net cash and no gross debt, and it is already free-cash-flow positive even though GAAP operating income is still negative. The buyer is paying a multiple that assumes the growth and margin inflection continue, and the recent quarters are the evidence that both are underway.

Bear Case

The bear case is competitive disruption, and the competitors are formidable and better capitalized. SentinelOne fights CrowdStrike and Microsoft Defender for the endpoint, Palo Alto Networks and others across the broader platform, and these are companies with larger sales forces, larger budgets, and in Microsoft's case the ability to bundle security into an enterprise software suite at near-zero marginal price. The FY2025 10-K names the threat directly: competitive risk includes "increased advancements and proliferation in the use of open artificial intelligence applications, partnering or acquisitions by our competitors or continuing market consolidation," and notes that some competitors "have recently made or could make acquisitions" to strengthen their position (accession 0001583708-25-000051). The stock fell roughly 32% amid competition and concerns about AI-model differentiation, which is the market pricing in exactly this risk (web research). If a larger rival's AI offering reaches parity, SentinelOne's differentiation erodes and the growth that the price requires slows.

The sales motion is a second pressure point. The same 10-K describes how large enterprises and government entities "often undertake a significant evaluation process that further lengthens our sales cycle" (accession 0001583708-25-000051). Long sales cycles in a contested market mean every deal is fought against the incumbent and won on a longer timeline, which makes growth lumpy and dependent on a steady pipeline that competitors are also working. The price assumes about 21% growth sustained, and only about 41% of comparable fast-growers historically held a pace like that for even five years.

The valuation leaves little margin if growth disappoints. On a pure asset or earnings-power basis the price is expensive: book value per share is only $4.27, the FCF-yield model capitalizes a thin free-cash-flow number to about $1.71, and the entire case rests on the forward-growth family, which assumes the margin ramp to 30% actually arrives. The recent takeover speculation cuts both ways: it can support the price as an acquisition floor, but it is also a tacit acknowledgment that the standalone path against larger competitors is hard enough that consolidation is on the table.

Valuation

With GAAP operating income still negative, the price is read against sales. At about 3.6x revenue, an enterprise value near 3.6x sales, the inversion solves to roughly 21% annual revenue growth and an eventual operating margin near 30%, computed at a 12.7% cost of capital holding a 29.6% terminal margin (74.1% gross margin times a mature-conversion prior). The near-term growth rate is within what SentinelOne has recently delivered, so the assumption reads as within range; the stretch is in how long the 20%-plus pace must persist.

The X-ray splits by family the way an inflecting software name does. The forward-growth methods carry the case: the margin-trajectory model marks about $16 and the discounted-future-market-cap model about $18, both near or above the quote. The asset family reads expensive against a $4.27 book value, and the FCF-yield earnings model marks only $1.71 because it capitalizes today's thin free cash flow with no credit for growth. The relative price-to-sales comp, at an 8x sector multiple, marks well above the price but is excluded from the consensus given negative earnings.

The characterization is that relative-multiple and growth-DCF justify the price while asset and earnings-power say expensive, which is the standard signature of a company whose value lives in future scale rather than current profit. The two variables that settle it are the durability of 20%-plus growth against larger competitors and whether the operating-margin inflection, already 600 basis points this year, continues toward the 30% the price assumes.

Catalysts

The recent results are the catalyst that reframed the story from cash-burning challenger to profitable-growth platform. SentinelOne crossed $1 billion in annual revenue and reached full-year operating profitability, with operating margin up more than 600 basis points year over year (web research). The most recent quarter showed revenue up 21% to about $277 million and annualized recurring revenue up 23% to roughly $1,163 million, with $100,000-plus ARR customers up 17% to 1,702 (web research). Management guided to second-quarter revenue near $290 million and reaffirmed full-year growth guidance near 20%.

The product catalysts center on AI and emerging modules. Purple AI reached a record 50% attach rate on licenses sold, and emerging products, cloud, data analytics, AI security, and threat services, now represent over half of annual bookings, with cloud ARR past $160 million, data above $130 million, and threat services across $100 million (web research). The attach rate and the bookings mix shift are the leading indicators of whether the platform expansion sustains the growth rate.

Two external catalysts sit on either side of the thesis. The stock has been pressured, down roughly 32%, by competition and questions about AI-model differentiation against larger rivals, and at the same time the strong outlook and AI positioning have sparked takeover speculation (web research). Watch the ARR growth rate, the Purple AI attach trend, the pace of operating-margin expansion, and any concrete M&A development, since each moves the thesis materially.

Sources: SentinelOne fiscal Q1 2027 and Q4 2026 results (investors.sentinelone.com, sec.gov 8-K, investing.com); SentinelOne competition and valuation coverage (indexbox.io, finance.yahoo.com, seekingalpha.com).

Peer Cohorts (Per Segment, With Filing Citations)

SentinelOne (consolidated) (reported)

Methodology Note

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.

View the full interactive S report on boothcheck