Which is pointless since they had a great earnings report, were cash flow positive for the quarter and raised their guidance. Additionally they mentioned in the call that no sector is more than 20% of their customers so they are diversified if a certain sector really tanks - like tech. They have 180 million in the bank so won't need credit markets any time soon and gradually approaching profitability.
Disclaimer: I have a position in NEWR and added today at the 21 level. This will certainly bounce back in the comings months or years. Will add if the irrationality continues.
It's trading at about 6x revenue right now and even lower when looking at forward revenues.
Their growth is tremendous and are on a path to profitability. I get it - when the market are getting banged around like it is, there are few safe places. I just think the baby is being thrown out with the bath water in a lot cases. I'm using this to average down a bit and hold.
Yeah I see your point, but what I mean is that when so much of the current value of a company is based on future events, fear unfortunately is never irrational.
And for New Relic the expectations are really high, could still turn out to be a great business story (and I also think it will) but not necessarily a good investment because so much of this future success is already embedded in the price.
AppDynamics, their direct competitor, is a late stage VC Unicorn ($2 bio evaluation) and delays its IPO.
Dynatrace another rather old-school competitor (like CA), which was bought out of Compuware by Thomas Bravo (private investor), has been taken private.
New Relic depends on smb sales, AppDynamics and Dynatrace more on enterprise sales. New Relic has the easier to use product, AppDynamic and Dynatrace are better at enterprise bullshit bingo and show more "nested pages" with often less detailed data to hide that they have worse/lacking insight. They stopped innovating like 2 years ago.
All three companies have a lot of employees and burn through their capital. Doesn't look good.
