What happened
Shares of Monday.com (MNDY -0.77%) rose as much as 15.9% on Monday morning, powered by an impressive earnings report. The provider of no-code app development and project management tools sported a 14.4% overnight gain as of 1:20 p.m. ET. That's the peppiest case of "the Mondays" I've seen in a while.
So what
Monday.com's first-quarter sales jumped 50% higher year over year, landing at $162 million. On the bottom line, the year-ago period's adjusted net loss of $0.96 per diluted share swung to a net profit of $0.14 per diluted share. Your average financial analyst would have settled for a net loss near $0.28 per share on revenues in the neighborhood of $155 million. The results also surged past the top end of management's official guidance for this period.
Now what
The company saw particularly strong sales to enterprise-class customers, where the client list grew 75% longer to 1,683 names. This group consists of customers whose annual contracts are worth at least $50,000. The recent launch of a sales-oriented customer relationships management (CRM) service also met a "tremendous" response from Monday.com's clients, according to CEO Roy Mann.
Overall, the company reached positive earnings ahead of schedule, and 24% of the surging top-line sales were converted into free cash flows.
The combination of rambunctious sales growth and solid bottom-line profits makes Monday.com a rare duck. The stock isn't cheap by any stretch of the imagination, but growth-oriented investors may want to take a closer look at it and perhaps start a fairly small position anyway. I see this hungry little growth monster going places in the long run.
