Member Info for bobocaca

The share price falling is unreasonable and unbelievable. I hope this was the doing of TB to get a better takeover price.

Nah, that guy has been saying the same thing for at least half a year and he still hasn't bought in.

Speaking of takeover, Thoma Bravo has recently raised $32B fund, has enough ammunition to buy Darktrace 10 times if they want to.
https://www.prnewswire.com/news-releases/thoma-bravo-completes-32-4-billion-fundraise-301696723.html

I've also became sceptical of the awards won. There are like >50 categories , I'm sure every company can find a category to claim they are best at. However, if the award could bring in US federal business, then that is marketing money well spent.
https://americansecuritytoday.com/award-categories/

Berylfu, US inflation and rate decision is next week. If you are more adventurous, you can buy some before next Tuesday. Otherwise, wait till the rate is out. Buy If stock rally, if not, hold to see if market mood changes in new year.

Crowdstrike is down 17% now in pre-market due to low growth. Maybe that's the reason Darktrace fell.

However, Darktrace is still growing, especially after recent announcement of customer reception of PREVENT. This makes Darktrace marking leading in cybersecurity industry. Those who sold Crowdstrike should buy into Darktrace instead.

Share price rise and fall, and the magnitude of this pullback is not even outrages. I'm not happy with Sheltie coming out every time when share price drop and said "I and Barclays told you so!". If the TA was accurate it should have recommended a buy at 285p and sell at 400p, according to you, Barclays have always recommended a sell for as far as I can remember. And you believe it, then act upon it and sell to earn yourself the right to say "I told you so".

Sheltie, since you have so much faith in Barclays, I presume you have sold you shares already?

Shortselling usually consist of rapid trade of small volume, but the volumes are quite large. So it looks more like big shareholder is selling.

getagrip, Darktrace share price did rise with £. I should probably rephrase, it doesn't just attract American buyers but in fact attract anyone who could choose to put their money into either US or UK market. L&G sold 1% shares after the mini-budget, I'm not sure if they sold it to cover gilt's margin call, but they certainly bought them back when pound started to rise. Looking from opposite perspective, I wouldn't invest my £ in US stock now due to rising £.

Most direct impact - rising £ will attract more American buyers.

Darktrace use a constant currency rate that they pick at the start of the year, and really it could be any number just so that the numbers reported in each quarter is consistent and comparable. Having said that, strong dollar can hurt year-on-year growth but not that much on P/E as you have pointed out, earning will need be converted back to £.

If you ask a different question, how will exchange rate affect the underlying business, then the answer is more complex. Assuming their dollar reserve is self-sufficient i.e. able to cover day-to-day $ operation, then the impact is minimal. Otherwise, if they have to convert £ to $ to pay for US employees, then strong $ means increased cost.

Charles, glad that you are talking about the business prospect rather than some random target price which is, I'd say unpredictable.

Darktrace isn't a sponsor in Wirld Cup, so it won't be visible to the viewer. However, if it successfully thwart cyber attack, then it can be opportunity for a PR release. I'm happy with customer's reception to PREVENT which should provide good earning reports for next couple of quarters before potential business win from US government.

https://www.shorttracker.co.uk/company/GB00BNYK8G86/

As I suspected, JPM started covering their short towards the end of last week.

Lending, opps, ya' right, that's not gross margin, but net profit margin.

Recession has already hit consumer facing companies hard e.g. Meta, Amazon; companies with lesser consumer exposure e.g. Microsoft fare better. There is a cushion of impact for B2B companies but they are not immune to wider economy slowdow and in fact have already feeling the heat. Cloudflare's growth has slowed, prompted share price avalanche in US cybersecurity shares in a few weeks back (we should see SentinelOne result in a few weeks time). Despite sea of bad news from US, we have yet heard alarming news from Darktrace. In fact, as per RNS, it is still growing rapidly, and this is high quality growth. Of course, there will be customers who decided not to renew the subscription (higher churn rate), it is just normal business behaviour as long as the churn rate doesn't increase rapidly. Given evidence so far, I'm not worried about customer loss.

Why do I say that? Because many existing customers buy their new product PREVENT, meaning they didn't have to spend high acquisition cost i.e. hiring more sales people which lead to high gross margin. Also because the customers are retaining their existing Darktrace products, the new revenue can possibly hike the existing forecast for the year, and P/E.

The practical implication of the RNS is that the business is not affected by economy downturn, and next trading update should not be disappointing. However, SP can still go down between now and January (unfortunately, this is how market works). If you see a dip, I'd say you should buy it.

Exactly, the weird one is Ade, not the RNS

The company has obligation to inform its shareholders of major developments e.g. loss of major customer or the opposite. This means the revenue from PREVENT must be significant and will reflect in next trading update. This is especially exciting if you compare with string of bad earning report from tech giants.

I am optimistic about the autumn statement, but so was I about the mini-budget...

Although revenue increases $100M+ from a year ago, the profit (ignoring one-off IPO related cost) only improves roughly a tenth of about $10M (just my rough estimate). For P/E to improve dramatically, they will need to keep the spending (mainly salary) in check. If that happen and spending stays at roughly the current level, given the 2023 revenue forecast., the P/E can fall sharply to ~50. We will need to wait till half year result in next March to get a glimpse of it.