Why Has F5 Networks Stock Risen Almost 1.5x Since 2019?
F5 Networks Inc. (NASDAQ: FFIV) stock price gained 44% from $139 in 2019 end, to around $200 currently, primarily due to favorable changes in its P/S multiple. Additionally, the company witnessed a rise in revenue over this period, and revenue per share has increased, despite a rise in the outstanding share count.
In our interactive dashboard, Why F5 Networks Stock Moved: FFIV Stock Has Gained 44% Since 2019, we break down the factors behind this move.
(A) FFIV’s Total Revenue has grown 19% from $2.2 billion in 2019 to $2.7 billion on an LTM basis
- FFIV’s total revenue steadily rose from $2.2 billion in FY ’19 to $2.6 billion in FY ’21, and currently stands at $2.7 billion on an LTM basis (FFIV’s fiscal year ends in September).
- F5 derives its revenues almost evenly from both, products and services, with the products segment defining more of the company’s overall growth during the past few years.
- For details about FFIV revenues and comparison to peers, see F5 Networks (FFIV) Revenue Comparison
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(B) Revenue per share (RPS) increased 18% from $37.33 in 2019 to $43.88 currently
- FFIV revenue rose from $2.2 billion in 2019 to $2.7 billion currently, while the outstanding share count increased from 60.1 million in 2019 to 60.8 million currently.
- Due to this, RPS has risen from $37.33 in FY ’19 to $43.88 currently.
(C) Price-To-Sales (P/S) multiple for FFIV rose from 3.8x in FY ’19 to 5.7x in FY ’21 but has pulled back to 4.6x currently, still higher than its FY ’19 level
- Due to FFIV’s consistent performance since 2019-end, its P/S multiple rose steadily from 3.8x in FY ’19 to 5.7x in FY ’21.
- However, amidst current geopolitical tensions dragging down the broader markets, the P/S multiple has pulled back and currently stands at around 4.6x.
- For additional details about the company’s historical returns and comparison to peers, see F5 Networks (FFIV) Stock Return.
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| Returns | Mar 2022 MTD [1] |
2022 YTD [1] |
2017-22 Total [2] |
| FFIV Return | 2% | -17% | 41% |
| S&P 500 Return | 2% | -7% | 98% |
| Trefis MS Portfolio Return | 2% | -8% | 261% |
[1] Month-to-date and year-to-date as of 3/18/2022
[2] Cumulative total returns since the end of 2016
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