The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how MongoDB (NASDAQ:MDB) and the rest of the data storage stocks fared in Q3.
Data is the lifeblood of the internet and software in general, and the amount of data created is accelerating. As a result, the importance of storing the data in scalable and efficient formats continues to rise, especially as its diversity and associated use cases expand from analyzing simple, structured datasets to high-scale processing of unstructured data such as images, audio, and video.
The 5 data storage stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 4% while next quarter’s revenue guidance was 0.8% above.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 9.4% since the latest earnings results.
MongoDB (NASDAQ:MDB)
Started in 2007 by the team behind Google’s ad platform, DoubleClick, MongoDB offers database-as-a-service that helps companies store large volumes of semi-structured data.
MongoDB reported revenues of $529.4 million, up 22.3% year on year. This print exceeded analysts’ expectations by 6.8%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.
"MongoDB's third quarter results were significantly ahead of expectations on the top and bottom line, driven by better-than-expected EA performance and 26% Atlas revenue growth. We continue to see success winning new business due to the superiority of MongoDB's developer data platform in addressing a wide variety of mission-critical use cases," said Dev Ittycheria, President and Chief Executive Officer of MongoDB.
MongoDB achieved the biggest analyst estimates beat of the whole group. The company added 125 enterprise customers paying more than $100,000 annually to reach a total of 2,314. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 33.3% since reporting and currently trades at $233.80.
Is now the time to buy MongoDB? Access our full analysis of the earnings results here, it’s free.
Best Q3: Commvault Systems (NASDAQ:CVLT)
Originally formed in 1988 as part of Bell Labs, Commvault (NASDAQ: CVLT) provides enterprise software used for data backup and recovery, cloud and infrastructure management, retention, and compliance.
Commvault Systems reported revenues of $233.3 million, up 16.1% year on year, outperforming analysts’ expectations by 5.6%. The business had an exceptional quarter with a solid beat of analysts’ billings estimates and an impressive beat of analysts’ EBITDA estimates.
Commvault Systems achieved the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 12.4% since reporting. It currently trades at $154.02.
Is now the time to buy Commvault Systems? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: Couchbase (NASDAQ:BASE)
Formed in 2011 with the merger of Membase and CouchOne, Couchbase (NASDAQ:BASE) is a database-as-a-service platform that allows enterprises to store large volumes of semi-structured data.
Couchbase reported revenues of $51.63 million, up 12.7% year on year, exceeding analysts’ expectations by 1.7%. Still, it was a slower quarter as it posted a significant miss of analysts’ billings estimates.
Couchbase delivered the weakest full-year guidance update in the group. As expected, the stock is down 28.1% since the results and currently trades at $15.20.
Read our full analysis of Couchbase’s results here.
DigitalOcean (NYSE:DOCN)
Started by brothers Ben and Moisey Uretsky, DigitalOcean (NYSE: DOCN) provides a simple, low-cost platform that allows developers and small and medium-sized businesses to host applications and data in the cloud.
DigitalOcean reported revenues of $198.5 million, up 12.1% year on year. This number beat analysts’ expectations by 0.9%. Zooming out, it was a satisfactory quarter as it also recorded a solid beat of analysts’ EBITDA estimates but EPS guidance for next quarter missing analysts’ expectations.
DigitalOcean had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is down 17.8% since reporting and currently trades at $33.56.
Read our full, actionable report on DigitalOcean here, it’s free.
Snowflake (NYSE:SNOW)
Founded in 2013 by three French engineers who spent decades working for Oracle, Snowflake (NYSE:SNOW) provides a data warehouse-as-a-service in the cloud that allows companies to store large amounts of data and analyze it in real time.
Snowflake reported revenues of $942.1 million, up 28.3% year on year. This print surpassed analysts’ expectations by 4.9%. Overall, it was a very strong quarter as it also produced an impressive beat of analysts’ EBITDA and billings estimates.
Snowflake delivered the fastest revenue growth among its peers. The company added 32 enterprise customers paying more than $1 million annually to reach a total of 542. The stock is up 19.6% since reporting and currently trades at $154.50.
Read our full, actionable report on Snowflake here, it’s free.
Market Update
Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.
Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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