Morningstar

Smartsheet Inc Class A SMAR

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Stock XNYS Rating as of
$55.34 +0.01 (0.02%)
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As of Delayed Price Closed

Company Report

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Smartsheet: Shareholders Should Await Improved Offer After Blackstone and Vista Equity Partners Bid

Emma Williams

Narrow-moat Smartsheet has received a go-private offer from Blackstone and Vista Equity Partners for $56.50 per share in a cash transaction valued at $8.4 billion. The announcement arrives following reports from Reuters regarding a potential bid, which we addressed in our Sept. 20 note. The takeover offer is subject to a shareholder vote and represents a 41% premium to Smartsheet's 90-day weighted average share price to July 17, but a 6% discount to our intrinsic valuation. Smartsheet has until Nov. 8 to solicit alternate proposals, and we recommend shareholders vote against this initial offer and hold out for a more attractive bid and takeover premium. Accordingly, we maintain our $60 per share standalone fair value estimate.

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Price vs Fair Value

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SMAR is trading at a 761% premium.
Price
$55.34
Fair Value
$78.00
Uncertainty
Very High
1-Star Price
$557.00
5-Star Price
$78.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Smartsheet has established a solid footing in the sticky enterprise market and is well-placed to grow existing relationships by upselling capabilities and converting free users.

Bears

The collaborative work management software market is fragmented and fiercely competitive, elevating pressure on Smartsheet to invest in product innovation.

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News

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Trading Information

Previous Close Price
$55.33
Day Range
$55.31–55.37
52-Week Range
$35.52–55.60
Bid/Ask
$55.31 / $55.88
Market Cap
$7.70 Bil
Volume/Avg
11.8 Mil / 2.7 Mil

Key Statistics

Price/Earnings (Normalized)
43.99
Price/Sales
7.27
Dividend Yield (Trailing)
0.00%
Dividend Yield (Forward)
0.00%
Total Yield
—

Company Profile

Smartsheet is a provider of collaborative work management software delivered via a cloud-based, software-as-a-service model. The firm’s solution offers scalable, dynamic tools to improve the efficiency of project and process management across countless use cases. Smartsheet’s offering supports workflow management across teams, provides real-time visibility into projects, and reporting and automation capabilities. The firm generates revenue via software subscriptions on a per-user basis, and incremental charges for added platform capabilities.
Sector
Technology
Industry
Software - Application
Stock Style Box
Small Growth
Total Number of Employees
3,341
Website
https://www.smartsheet.com

Competitors

Valuation

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Metric
SMAR
ASAN
GOOGL
Price/Earnings (Normalized)
 43.99—23.35
Price/Book Value
 11.439.236.72
Price/Sales
 7.273.856.28
Price/Cash Flow
 29.64408.3217.05
Price/Earnings
SMAR
ASAN
GOOGL

Financial Strength

Metric
SMAR
ASAN
GOOGL
Quick Ratio
 1.361.491.90
Current Ratio
 1.451.632.08
Interest Coverage
 —−70.19281.77
Quick Ratio
SMAR
ASAN
GOOGL

Profitability

Metric
SMAR
ASAN
GOOGL
Return on Assets (Normalized)
 13.77%−4.45%26.65%
Return on Equity (Normalized)
 29.22%−13.28%37.68%
Return on Invested Capital (Normalized)
 23.19%−9.52%33.14%
Return on Assets
SMAR
ASAN
GOOGL

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