Asana (NYSE: ASAN) is a piece administration platform that permits groups and firms to prepare, handle and observe work. This will vary from each day duties to product launches and advertising and marketing campaigns.
The corporate was based in 2008, and its mission is to “assist humanity thrive by enabling the world’s groups to work collectively effortlessly”. After greater than a yr on the general public markets and the inventory lower in half from its highs, is Asana an excellent funding?
The bull case for Asana:
Asana is a founder-led firm by co-founders and former Meta Platforms (previously Fb) workers Justin Rosenstein, an adviser and member of the Board of Administrators and CEO Dustin Moskovitz. Moskovitz has been aggressively shopping for shares of Asana and now owns roughly 17% of the corporate, which suggests his pursuits are aligned with that of shareholders.
Somewhat than the present means of spending the vast majority of time checking emails, gathering info, and speaking internally, Asana supplies an efficient solution to work collaboratively, effectively, and successfully. Groups utilizing Asana have greater productiveness and worth proposition, with 83% of surveyed prospects agreeing that it will increase job efficiency whereas 77% agree that it reduces time.
Asana has been profitable with its land and broaden enterprise mannequin, and its dollar-based web retention price of 120% in Q3 2020 is demonstrative of this and the stickiness of its product. It now has 114,000 paying prospects, up 28% YoY, and contains well-known firms corresponding to Zoom, Autodesk, LVMH, and extra. It continues to develop quickly, with income rising by 70% year-over-year in Q3, reaching $100.3 million together with extraordinarily spectacular gross margins of 90%. The variety of prospects spending $5,000 or extra elevated by 96% and made up over two-thirds of income.
Asana believes that its complete addressable market might be within the area of $32 billion in 2023, which means that there’s a huge alternative for development. With an ongoing development of distant working together with
The bear case for Asana:
Asana is working at a loss that totaled $69.3 million in Q3. It additionally trades at a excessive valuation of 34X gross sales even after the current pullback leaving little room for error. The corporate must proceed spending closely on analysis and improvement and advertising and marketing to innovate and appeal to prospects.
A number of firms are trying to sort out the identical drawback, corresponding to Atlassian’s Trello, Monday.com, and extra. Even oblique gamers corresponding to Slack could possibly be thought-about opponents (though Asana would state in any other case). It’s a area the place change is speedy and leaves query marks over Asana’s means to maintain up, significantly at this valuation.
So, ought to I purchase Asana inventory?
Though Asana appears promising, the valuation coupled with its spending and competitors within the area means traders ought to assume twice earlier than shopping for. Nonetheless, it’s deserving of a spot on the watchlist.
Quickfire spherical:
When did Asana go public?
Asana went public by a direct itemizing on September 30 2021.
The place is Asana headquartered?
Asana is headquartered in San Francisco, California.
