CALLMNDY.TA26 days ago7.1Kviews

monday.com: the capex drag just stopped being a drag

The spend is finally producing more than it costs to carry. Every quarter past the crossover compounds in the opposite direction to the last two years.

Sara Cohen@sara_cohen

The mechanism is a depreciation schedule. Capacity is expensed over its useful life while the revenue it enables lands immediately, so the reported margin is worst in the build year and best two years after it, entirely independent of demand. The disclosure carries it. Management broke out the incremental contribution for the first time and it exceeded the incremental depreciation line, which is the first time that has been true since the build began. The position: long on monday.com, entry locked at publication and the exit dated rather than open-ended. The target is stated in the call block above and the horizon with it. Sized to the catalyst rather than to conviction, with the invalidation written into the kill-switch card instead of left implicit. Multiple compression across the sector is the risk that is not company-specific and not hedged here. It would overwhelm the operating argument in either direction.

Discussion · 4

Yael BrennerAUG 18

This changed my mind. The point about conversion rather than demand is the right one. Does the same logic apply to the closest comparable?

Omri ShakedAUG 18

Reading this against my own model. The comp table did more work for me than the narrative did. Is there a cleaner way to express this than the equity?

Yael BrennerAUG 17

This is the clearest write-up I have seen on the name. The exclusivity window is the part the market keeps mispricing. Where does this break if rates back up another 50bp?

Pauline VidalAUG 17

Useful framing. The regulatory ceiling being quantified changes the model, not just the headline. What is the level where you would walk away?