Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

A highly collaborative investment professional and research analyst with 10+ years of international experience in equity research, treasury operations, and trading positions across multiple asset classes at leading multinational banks Citibank and Morgan Stanley, UHNWI-backed family office and European independent equity research firm. A respectable background in equity capital markets, corporate treasury, investment banking operations, equity research analysis and portfolio management.

2024 High Conviction: BILL Holdings – Hyper Growth Through M&A Deals Is Over While SMBs Struggle

Equity Bottom-Up

<ul>
<li>BILL Holdings shares significantly underperformed in 2024 with shares down ~37% year-to-date versus a 12% gain on the Nasdaq Composite Index.  </li>
<li>Shares saw sell-off post 3Q’FY24 earnings as results indicated a weak 4Q’FY24 guidance and customer churn while SMBs continue to be pressured by high inflation and interest rates.</li>
<li>My bear case implies a $31 valuation (vs. prior $25 PT), based on ~2x FY25E EV/Revenue and bear case FY25E revenue of $1368M, representing ~40% downside vs. current levels.</li>
</ul>


BILL Holdings shares significantly underperformed in 2024 with shares down ~37% year-to-date versus a 12% gain on the Nasdaq Composite Index.  
Shares saw sell-off post 3Q’FY24 earnings as results indicated a weak 4Q’FY24 guidance and customer churn while SMBs continue to be pressured by high inflation and interest rates.
My bear case implies a $31 valuation (vs. prior $25 PT), based on ~2x FY25E EV/Revenue and bear case FY25E revenue of $1368M, representing ~40% downside vs. current levels.


2024 High Conviction Update: BILL Holdings, End of the Share Repurchase Program and Customer Churn