PagerDuty (PD) AI Stock Analysis

• Market Cap: $1.46B
• Dividend Yield: N/A
• Average Volume (3M): 1.30M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.47
• Revenue Growth: 8.55%
• EPS Growth: 60.23%
• Country: US
• Employees: 1,242
• Sector: Technology
• Sector Strength: 84
• Industry: Software - Application
• EPS (TTM): 0.24
• Shares Outstanding: 92,173,970
• 10 Day Avg. Volume: 1,991,015
• 30 Day Avg. Volume: 1,297,427
• PEG Ratio: 0.69
• Price to Book (P/B): 12.74
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.94
• Enterprise Value/Market Cap: 0.96
• Enterprise Value/Revenue: 0.76
• Enterprise Value/Gross Profit: 3.54
• Enterprise Value/Ebitda: -16.02
• 1Y Price Target: $18.50
• Price Target Upside: 21.55% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 12

• Rating: 71 Outperform
• Price Target: $17.00 ▲(11.70%Upside)

PagerDuty's overall score reflects strong financial performance with notable revenue and cash flow growth, tempered by ongoing profitability challenges and reliance on debt. Technical analysis indicates bearish trends, while valuation metrics show limitations due to net losses. Positive highlights from the earnings call, such as strategic partnerships and AI initiatives, contribute to a balanced outlook despite external uncertainties.

Positive Factors

Customer Growth

The company managed to add 133 customers, resulting in one of the best quarters in nearly 3 years for customer growth.

Profit Performance

Improving profit performance is seen as an enduring positive aspect, with the potential to reach 25% operating margins annually within the next three years.

Negative Factors

Customer Retention

Net Revenue Retention slipped 2 points lower to 104%, which is below prior expectations for the full year, signaling potential challenges in customer retention.

Execution Challenges

PagerDuty is challenged by go-to-market execution issues and organizational transitions, affecting its top-line trends.

Revenue Guidance

Revenue growth guidance for the full year was cut by nearly 2 percentage points, indicating a cautious outlook for future revenue.

PagerDuty Business Overview & Revenue Model

Company Description

PagerDuty, Inc. operates a digital operations management platform in the United States, Japan, and internationally. Its digital operations management platform collects data digital signals from virtually any software-enabled system or device, and leverage powerful machine learning to correlate, process, and predict opportunities and issues. It serves various industries, including software and technology, telecommunications, retail, travel and hospitality, media and entertainment, and financial services. PagerDuty, Inc. was founded in 2009 and is headquartered in San Francisco, California.

How the Company Makes Money

PagerDuty generates revenue primarily through a subscription-based model, offering its software-as-a-service (SaaS) platform to businesses of all sizes. The company charges customers based on the number of users and the specific features utilized within its platform, with different pricing tiers available to accommodate varying needs. Key revenue streams include subscription fees from its incident management and automation solutions. Additionally, PagerDuty may derive income from professional services, which assist clients in implementing and optimizing their use of the platform. Strategic partnerships and integrations with other technology providers also enhance its offerings, potentially contributing to customer acquisition and retention.

PagerDuty Financial Statement Overview

Summary

PagerDuty is on a positive growth trajectory with impressive revenue and cash flow growth, signifying potential for future profitability. While the gross profit margins are robust, persistent net losses and reliance on debt highlight areas needing improvement. The balance sheet reflects moderate leverage, typical of growth-focused tech companies, but underscores the need for strategic initiatives to enhance profitability and equity financing. The strong cash flow position provides a buffer, facilitating continued investment and potential debt reduction.

Income Statement

PagerDuty has demonstrated strong revenue growth with a 10.54% increase from the previous year, indicative of a robust growth trajectory. The company's gross profit margin is high at 83.30% TTM, showcasing its efficient cost management in generating revenue. However, the net profit margin remains negative at -7.13% TTM, reflecting ongoing operational challenges and losses, although improving from previous periods. The EBIT margin of -10.15% and EBITDA margin of -3.05% TTM suggest that operational efficiencies need enhancement to achieve profitability.

Balance Sheet

The balance sheet reflects a moderate level of financial stability. PagerDuty's debt-to-equity ratio stands at 3.18, indicating reliance on debt but showing a manageable level of leverage typical for growth-oriented tech firms. The return on equity is negative at -23.30% TTM, due to the negative net income, highlighting profitability challenges. The equity ratio of 15.71% TTM suggests a lower proportion of equity financing, posing potential risks if revenue growth does not translate into profitability.

Cash Flow

PagerDuty displays strong cash flow performance with a free cash flow growth rate of 71.19% from the previous year, indicating effective cash generation. The operating cash flow to net income ratio is 3.53 TTM, highlighting substantial cash flow relative to net income and reflecting efficient operations. The free cash flow to net income ratio of 3.25 TTM further supports the company's ability to generate cash despite net losses, providing a cushion for future investments and debt obligations.

Breakdown
TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
476.13M	467.50M	430.70M	370.79M	281.40M	213.56M
	Gross Profit
396.63M	387.83M	352.87M	300.36M	233.03M	182.87M
	EBIT
-48.37M	-59.77M	-96.25M	-129.38M	-101.71M	-66.28M
	EBITDA
-14.53M	-14.52M	-52.80M	-107.20M	-93.36M	-57.57M
	Net Income Common Stockholders
-33.94M	-42.73M	-81.76M	-129.22M	-107.45M	-68.90M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
346.09M	570.83M	571.19M	476.97M	543.36M	560.28M
	Total Assets
420.00M	927.27M	925.31M	817.87M	806.45M	795.44M
	Total Debt
0.00	463.65M	461.02M	301.52M	307.62M	249.33M
	Net Debt
-176.35M	117.19M	98.01M	27.50M	-42.17M	-89.83M
	Total Liabilities
115.51M	779.22M	746.41M	575.79M	539.47M	428.72M
	Stockholders Equity
304.49M	129.83M	171.60M	240.98M	266.98M	366.73M
Cash Flow		Free Cash Flow
110.30M	108.41M	64.43M	8.51M	-12.83M	5.25M
	Operating Cash Flow
119.91M	117.89M	71.97M	16.98M	-6.02M	10.10M
	Investing Cash Flow
-18.83M	-19.97M	-30.52M	-86.17M	17.38M	-49.32M
	Financing Cash Flow
-113.83M	-116.14M	51.60M	-6.41M	-736.00K	254.37M

PagerDuty Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 15.22
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PD, the sentiment is Neutral. The current price of 15.22 is below the 20-day moving average (MA) of 15.90, below the 50-day MA of 15.82, and below the 200-day MA of 17.99, indicating a neutral trend. The MACD of -0.10 indicates Negative momentum. The RSI at 50.38 is Neutral, neither overbought nor oversold. The STOCH value of 85.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PD.

PagerDuty Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXM	80 Outperform	$2.29B	21.52	17.50%	―	6.75%	97.06%
SPNS	76 Outperform	$1.66B	22.93	16.09%	1.95%	3.84%	10.25%
PD	71 Outperform	$1.46B	―	-23.09%	―	8.55%	60.23%
SPT	66 Neutral	$1.31B	―	-36.95%	―	17.79%	16.49%
JAMF	63 Neutral	$1.40B	―	-6.48%	―	10.75%	56.37%
MLNK	63 Neutral	$1.36B	―	-6.49%	―	5.15%	28.27%
Sector *	62 Neutral	$11.93B	10.60	-7.51%	3.00%	7.40%	-8.09%

PagerDuty Corporate Events

PagerDuty Announces Board Appointment with Scalar Gauge

On April 28, 2025, PagerDuty announced a cooperation agreement with Scalar Gauge Fund, resulting in the appointment of Donald J. Carty to its Board of Directors as a Class I director. This strategic move is part of PagerDuty’s efforts to enhance its board with experienced leaders, aiming to drive growth and profitability through a focus on enterprise customers and evolving market strategies. The agreement includes customary standstill provisions and voting commitments from Scalar Gauge, reflecting a collaborative approach to enhancing shareholder value.