People were locked in their homes through the better part of last year due to the COVID-19 related restrictions. The remote lifestyle led to many new investors flocking to trading not only stocks and options but also cryptocurrencies, which have been skyrocketing since 2020.
Bitcoin, the most popular digital currency globally, experienced some significant volatility the past year on investors’ concerns over China’s ban and different hacks and thefts. However, the digital currency gained 127% year-to-date to hit $66,500 when writing this article, reaching closer to a record high of $66,900, set in late October.
While crypto bulls expect Bitcoin to keep rallying this year and beyond, considering the highly volatile nature of this digital currency, it could be worth watching tech stocks Cloudflare Inc. (NET), Bill.com Holdings Inc. (BILL), Asana Inc. (ASAN), and DigitalOcean Holdings Inc. (DOCN), which have widely outperformed bitcoin so far this year.
Cloudflare Inc. (NET)
NET is a security, performance, and reliability company helping to build a better internet. The company operates as a cloud platform that delivers a range of network services to businesses worldwide. It provides an integrated cloud-based security solution to secure a range of combinations of platforms, including public cloud, private cloud, on-premise, software-as-a-service applications, and Internet of Things (IoT) devices.
On October 27, 2021, NET was named by Forrester Research, Inc. as a Leader in The Forrester New Wave: Edge Development Platforms. Its Cloudflare Workers Developer Platform was differentiated into eight criteria: developer experience, programming model, integrations, and roadmap. According to the report, the global reach and breadth of the Cloudflare edge development platform make it a good solution for development teams that want to build high-performance websites, support personalized content and defend against malicious attacks.
For the third quarter ended September 30, 2021, NET’s revenues increased 51% year-over-year to $172.30 million, while the non-GAAP gross profit increased 54.9% year-over-year to $136.60 million. The company’s non-GAAP income from operations was $2.20 million compared to a loss of $4.50 million in the prior-year quarter.
Analysts expect NET’s EPS to increase 100% year-over-year in fiscal 2022. Its revenues are expected to increase 46.6% year-over-year to $631.81 million in fiscal 2021. It surpassed consensus EPS estimates in three of the trailing four quarters. On a year-to-date basis, the stock has been up 159% to close Friday’s trading session at $197.26.
Bill.com Holdings Inc. (BILL)
BILL is a leading provider of cloud-based software that simplifies, digitizes, and automates back-office financial processes for small and mid-sized businesses. It provides an AI-enabled financial software platform that creates seamless connections among users, suppliers, and clients.
On September 1, 2021, BILL announced the acquisition of a leading mobile-first accounts receivable software provider, Invoice2go. BILL’s Founder and CEO said, “With the accounts receivable expertise and international footprint that the Invoice2go team brings, we will accelerate our vision to be the one-stop solution for businesses to transform their financial operations.”
BILL’s total revenues increased 152% year-over-year to $116.40 million for the first quarter of fiscal 2022. Its non-GAAP gross profit increased 175.6% year-over-year to $97 million. The company’s organic subscription fees increased 39% year-over-year to $34.10 million.
Analysts expect BILL’s revenues for fiscal 2022 to increase 104.6% year-over-year to $487.39 million. It surpassed the Street EPS estimates in three of the trailing four quarters. The stock has gained 145% on a year-to-date basis to close Friday’s trading session at $334.46.
Asana Inc. (ASAN)
ASANA operates a work management platform for individuals, team leads, and executives around the world. It provides a work management platform as software as a service that enables individuals and teams to get their work done faster while enhancing employee engagement by allowing them to see how their work aligns with the organization’s mission.
ASANA has been named as a leader in the IDC MarketScape: Worldwide Collaboration and Community Applications 2021 Vendor Assessment. COO Anne Raimondi said, “As we enter a new world of hybrid work, the IDC Marketscape highlights why collaboration work management applications like Asana are now critical for enterprise productivity. By providing greater clarity and alignment, we’re helping millions of organizations achieve their missions faster.”
ASANA’s revenues for the fiscal second quarter ended July 31, 2021, increased 72% year-over-year to $89.5 million. Its non-GAAP net loss per share was $0.23 compared to $0.34 in the prior-year quarter. The company’s cash flows from operating activities were negative $8.50 million compared to negative of $22.10 million in the prior-year quarter.
Analysts expect its revenues for the third quarter fiscal 2022 to increase 73.1% year-over-year to $93.7 million. It has surpassed consensus EPS estimates in each of the trailing four quarters. On a year-to-date basis, the stock has gained 333% to close Friday’s trading session at $128.07.
DigitalOcean Holdings Inc. (DOCN)
DOCN’s platform provides on-demand infrastructure and platform tools for developers, start-ups, and small to medium-size businesses. The company offers infrastructure solutions across compute, storage, and networking, while also enabling developers to extend the native capabilities of its cloud with fully managed application, container and database offerings.
On September 7, 2021, DOCN announced the acquisition of Nimbella, a serverless platform provider. This acquisition expands DOCN’s capabilities into the rapidly growing function-as-a-service (FaaS) market and will add serverless compute offering to complement the company’s existing Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) offerings.
DOCN’s revenues for the third quarter ended September 30, 2021, increased 37% year-over-year to $111.40 million, while its adjusted EBITDA increased 37.9% year-over-year to $36.40 million. Its average revenue per customer increased 28% year-over-year. The company’s cash flow from operations increased 72.5% year-over-year to $40.20 million.
Analysts expect its EPS and revenues for fiscal 2022 to increase 75.8% and 31.9% year-over-year to $0.58 and $563.52 million, respectively. The stock has gained 141% on a year-to-date basis to close Friday’s trading session at $102.61.
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NET shares were trading at $206.73 per share on Monday morning, up $9.47 (+4.80%). Year-to-date, NET has gained 172.05%, versus a 26.55% rise in the benchmark S&P 500 index during the same period.
About the Author: Dipanjan Banchur
Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets. More...
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