In the world of tech stocks, where traditional valuation metrics might not always apply, MAU can offer a tangible measure of a company's appeal and staying power. In some cases, investors pay more attention to the rise and fall in total subscribers or MAUs than they do to revenues or profits.
How to use MAU
Understanding MAU can be a valuable tool in your investment toolkit. When evaluating potential investments in the tech or digital space, consider the company's MAU trends. Is it growing? Is it stagnant? Or is it declining? How does the MAU value compare to other companies in the same sector?
If the company you're assessing has added MAUs in recent quarters while rivals saw lower numbers, this company likely is winning market share in terms of user engagement. These trends can offer insights into the company's future prospects.
Moreover, some companies supplement their MAU figures with other engagement metrics, such as daily active users (DAU) or weekly active users (WAU). This practice is fairly common among social media companies, where frequent user engagement is king.
It's a helpful reporting model, too. Breaking usage patterns down into different portion sizes can provide a more comprehensive view of trends. For instance, a high MAU with a low DAU might indicate that while many users visit monthly, fewer people see the service as a daily must-have.
Lastly, remember that while MAU is a valuable metric, it's just one piece of the larger puzzle. Always consider it in conjunction with other financial and operational metrics to get a holistic view of a company's health and potential.