Surging Revenues Have Driven 2x Rise In Coupa Software’s Stock Price Since Late 2017

COUP: Coupa Software logo
COUP
Coupa Software

Coupa Software Inc. (NASDAQ: COUP) stock price rose more than 2x from $31 in 2017 end to around $65 currently, primarily due to favorable changes in its sales. During this period, the company witnessed a strong 300% rise in revenues, and despite a rise in its outstanding share count, revenue per share rose almost 200%. Additionally, over the same period, the S&P 500 returned around 55%, meaning that Coupa stock managed to strongly outperform the broader markets since 2017-end.

In our interactive dashboard, Why Coupa Software Stock Moved: COUP Stock Has Gained 107% Since 2017, we break down the factors behind this move.

(A) Coupa’s Total Revenue has grown 304% from $186.8 million in FY 2018 to $754.7 million on an LTM basis

  • Coupa’s total revenue has risen steadily from $186.8 million in FY ’18 to $725.3 million in FY ’22, and currently stands even higher at $754.7 million on an LTM basis (Coupa’s fiscal year ends in January).
  • Coupa Software is a global technology platform for Business Spend Management and operates in only one reporting segment: cloud platform, which makes up 100% of the company’s sales.
  • For additional details about Coupa’s revenues and comparison to peers, see Coupa Software (COUP) Revenue Comparison
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(B) Revenue per share (RPS) increased 183% from $3.54 in FY 2018 to $10.00 currently

  • Coupa revenue rose from $186.8 million in 2018 to $754.7 million currently, while the outstanding share count increased from 52.8 million in 2018 to around 75.4 million currently.
  • Due to this, RPS has jumped from $3.54 in FY ’18 to $10.00 currently.

(C) Price-To-Sales (P/S) multiple for Coupa rose strongly from 12.6x in 2017 end to almost 66x by 2020 end, but has pulled back to 6.5x currently, almost half of what it was in late 2017

  • Coupa’s P/S multiple rose strongly to 65.7x by late 2020, on the back of rising investor expectations surrounding sustained sales growth amidst rising demand for the company’s services.
  • However, due to current geopolitical tensions and the increased economic uncertainty weighing on the broader markets, the P/S multiple has pulled back, currently standing at around 6.5x.
  • For additional details about the company stock returns and comparison to peers, see Coupa Software (COUP) Stock Return Comparison.

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Returns Jul 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
 COUP Return 15% -59% 161%
 S&P 500 Return 9% -13% 84%
 Trefis Multi-Strategy Portfolio 12% -14% 244%

[1] Month-to-date and year-to-date as of 7/29/2022
[2] Cumulative total returns since the end of 2016

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