Summary
HubSpot remains one of the best stock for the year, up 40% year to date, despite being down 20% from the recent highs.
Q3 revenue grew 35% y/y to $131.8 million, which beat consensus estimates for $126.7 million, or 30% y/y growth.
Valuation appears to be a bit excessive, trading at nearly 10x forward revenue despite the peer group trading closer to 5-6x forward revenue; we could see a downward re-rating soon.
HubSpot (HUBS) has remained a volatile stock for most of the year, up nearly 40% year to date, however, down nearly 20% from their all-time highs. The stock was a huge success for most of the year, up nearly 70% at the high point, however, the stock has been in a downward trend since mid-September and a reversal seems challenging at this point.
HUBS reported a relatively strong Q3 earnings report in September, beating consensus estimates for both revenue and EPS. However, the company did admit their growth rate is slowing down, albeit from a revenue growth rate of ~35%. At this point, it appears investors have baked in a slowdown in growth, which should ultimately be appropriate for a company growing at this fast of a rate.
