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Riskified Ltd. Class A (RSKD)
:RSKD
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Riskified
(NYSE:RSKD)
Rating:71Outperform
Price Target:
$6.00
▲(23.71%Upside)
Positive Factors
Earnings
March-quarter results exceeded expectations, with revenue growing 8% to $82.4 million and adjusted EBITDA reaching $1.3 million.
Financial Position
Riskified maintains a strong balance sheet with $376 million cash and no debt, and continues to improve margins and free cash flow.
New Services
Riskified continues to make progress in growing higher-margin new services, as revenue from these products grew 190% year-over-year.
Negative Factors
Customer Loss
Reported results will remain pressured by the previously disclosed $18 million revenue headwind related to the deconversion of a large six-year tenured customer in the home category.
Revenue Growth Slowdown
Including a $18 million headwind related to the deconversion of a large customer, initial 2025 guidance calls for 2%-6% revenue growth, which is a slowdown from 10% in 2024.
Riskified (RSKD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$776.89M
Dividend YieldN/A
Average Volume (3M)403.57K
Price to Earnings (P/E)―
Beta (1Y)0.99
Revenue Growth9.30%
EPS Growth24.96%
CountryUS
Employees652
SectorTechnology
Sector Strength78
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.09
Shares Outstanding112,781,640
10 Day Avg. Volume606,690
30 Day Avg. Volume403,572
Financial Highlights & Ratios
PEG Ratio-2.27
Price to Book (P/B)2.07
Price to Sales (P/S)0.00
P/FCF Ratio18.98
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$6.03Price Target Upside24.33% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Riskified Business Overview & Revenue Model
Company DescriptionRiskified Ltd. operates an e-commerce risk management platform that allows online merchants to create trusted relationships with their consumers in the United States, Europe, the Middle East, Africa, and internationally. It offers Chargeback Guarantee that approves or denies online orders; Policy Protect and Account Secure, which identifies and blocks consumers that may be taking advantage of the merchant's terms and conditions or that may be trying to gain unauthorized access to another consumer's account; Deco and PSD2, a optimize products that help merchants to avoid bank authorization failures and abandoned shopping carts resulting from the secure customer authentication process. The company was incorporated in 2012 and is headquartered in Tel Aviv, Israel.
How the Company Makes MoneyRiskified generates revenue primarily through a software-as-a-service (SaaS) model where merchants pay for fraud prevention services based on the volume of transactions processed. The company typically charges a percentage of the transaction value for the orders it reviews and approves. Significant partnerships with major online retailers and payment processors also contribute to its earnings by expanding its customer base and facilitating integration with various e-commerce platforms. Riskified's ability to reduce chargebacks and fraudulent transactions for its clients further solidifies its value proposition in the market.
Riskified Earnings Call Summary
Earnings Call Date:May 14, 2025
(Q1-2025)
| % Change Since: -1.82%|
Next Earnings Date:Aug 13, 2025
Earnings Call Sentiment Positive
Riskified demonstrated strong international growth, high retention rates, and significant new product revenue growth, maintaining positive adjusted EBITDA. However, challenges were noted in the home category and same-store sales pressure, with a decline in gross margins.Q1-2025 Updates
Positive Updates
Record Revenue and Growth
Riskified reported a revenue growth of 8% year-over-year, reaching $82.4 million in Q1 2025. GMV for the quarter was $34.2 billion, reflecting a 7% increase year-over-year.
High Retention Rates
Riskified achieved a 100% renewal rate across its top 20 contracts up for renewal during the first quarter, with nearly half extended as multiyear agreements.
Significant Growth in New Product Revenue
New product revenue growth was up approximately 190% year-over-year, driven by the adoption of Riskified's expanded product portfolio.
International Growth
Eight of Riskified's top 10 new logos won during the first quarter were headquartered outside of the United States, with significant growth in APAC (70%) and Outer Americas (13%).
Positive Adjusted EBITDA
Riskified reported a positive adjusted EBITDA of $1.3 million for the first quarter, marking the sixth consecutive quarter of positive adjusted EBITDA.
Negative Updates
Decline in Home Category
The home category contracted by 74%, contributing to a 5% year-over-year decline in the United States.
Same-Store Sales Pressure
Continued same-store sales pressure was noted in high-end fashion and sneakers sub-verticals, impacting overall growth.
Gross Margin Decline
The non-GAAP gross profit margin for Q1 2025 was approximately 50%, a year-over-year decline due to the ramp-up of significant new merchants in newer categories and geographies.
Company Guidance
During Riskified's first quarter 2025 earnings call, the company provided detailed guidance on its financial performance and strategic initiatives. The call highlighted an 8% year-over-year revenue growth, driven by a global go-to-market strategy and a 100% renewal rate for top 20 contracts. The company reported a GMV of $34.2 billion, reflecting a 7% increase year-over-year, and first-quarter revenue of $82.4 million. Riskified achieved a positive adjusted EBITDA of $1.3 million for the sixth consecutive quarter and maintained a strong balance sheet with $357 million in cash and zero debt. The company projected full-year revenue between $333 million and $346 million, with adjusted EBITDA ranging from $18 million to $26 million. The pipeline expansion and product portfolio growth, particularly in the money transfer and payments category, contributed to a 190% increase in new product revenue year-over-year. Despite macroeconomic challenges, Riskified remains confident in its ability to generate additional adjusted EBITDA margin expansion and deliver long-term shareholder value.Riskified Financial Statement Overview
Summary
Riskified shows strong revenue growth and improved cash flows, indicating positive operational prospects. However, profitability challenges persist due to negative net income and EBIT margins, despite a solid balance sheet with low leverage.Income Statement
Riskified has shown consistent revenue growth over the years, with a notable revenue growth rate of 10.06% from 2023 to 2024. However, profitability remains a challenge, indicated by negative EBIT and Net Income margins. The gross profit margin stands at 52.20% for 2024, showcasing efficient cost management at the gross level, but overall profitability is hindered by high operating expenses.65
Positive
Balance Sheet
The balance sheet is strong, supported by a high equity ratio of 77.11% in 2024, indicating a low level of leverage. The Debt-to-Equity ratio is low at 0.07, reflecting prudent financial management. However, the consistent negative net income impacts return on equity, which remains negative despite improvements over the years.70
Positive
Cash Flow
Cash flow from operations has improved significantly, with an operating cash flow to net income ratio of 1.14 in 2024, indicating better cash generation from operations. Free cash flow has grown notably by 559.38% from 2023 to 2024, showing strong cash flow management. These improvements are positive, but the company still faces challenges in achieving positive net income.75
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 327.52M | 297.61M | 261.25M | 229.14M | 169.74M |
| Gross Profit | ||||
| 170.94M | 152.52M | 135.10M | 122.97M | 92.82M |
| EBIT | ||||
| -47.85M | -76.85M | -108.63M | -55.40M | -6.81M |
| EBITDA | ||||
| -42.97M | -71.75M | -108.63M | -55.40M | -5.45M |
| Net Income Common Stockholders | ||||
| -34.92M | -59.03M | -103.99M | -178.88M | -11.35M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 376.06M | 474.81M | 475.67M | 503.27M | 117.62M |
| Total Assets | ||||
| 495.86M | 601.93M | 608.97M | 600.63M | 180.56M |
| Total Debt | ||||
| 27.53M | 31.31M | 37.42M | 0.00 | 0.00 |
| Net Debt | ||||
| -343.53M | -409.53M | -151.25M | -418.14M | -103.61M |
| Total Liabilities | ||||
| 113.56M | 110.21M | 112.55M | 71.77M | 223.87M |
| Stockholders Equity | ||||
| 382.30M | 491.72M | 496.42M | 528.86M | -43.31M |
| Cash Flow | Free Cash Flow | |||
| 39.06M | 5.92M | -34.26M | -33.78M | -6.08M |
| Operating Cash Flow | ||||
| 39.70M | 7.28M | -26.25M | -20.28M | -3.12M |
| Investing Cash Flow | ||||
| 27.75M | 251.56M | -210.01M | -84.44M | -16.96M |
| Financing Cash Flow | ||||
| -136.82M | -9.31M | 3.85M | 423.19M | 54.02M |
Riskified Technical Analysis
Neutral
4.85
Price Trends
4.65
Positive
4.89
Negative
4.82
Positive
Market Momentum
0.10
Negative
51.27
Neutral
36.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RSKD, the sentiment is Neutral. The current price of 4.85 is above the 20-day moving average (MA) of 4.83, above the 50-day MA of 4.65, and above the 200-day MA of 4.82, indicating a bullish trend. The MACD of 0.10 indicates Negative momentum. The RSI at 51.27 is Neutral, neither overbought nor oversold. The STOCH value of 36.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RSKD.
Riskified Risk Analysis
Riskified disclosed 64 risk factors in its most recent earnings report. Riskified reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 2 New Risks
1.
Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate, and even if the market in which we compete achieves the forecasted growth, our business could fail to grow at similar rates, if at all. Q4, 2024
2.
We may need to periodically realign our organization and may experience difficulties in managing either potential growth or reductions in force, which could disrupt our operations. Q4, 2024
Riskified Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
86 Outperform | $948.21M | 9.29 | 21.03% | ― | 6.40% | 9.72% | |
71 Outperform | $1.13B | 74.84 | 6.26% | ― | 7.71% | ― | |
71 Outperform | $776.89M | ― | -9.00% | ― | 9.30% | 24.96% | |
69 Neutral | $843.40M | 447.84 | 4.15% | ― | 30.64% | ― | |
61 Neutral | $11.28B | 10.16 | -6.88% | 2.97% | 7.41% | -8.93% | |
55 Neutral | $899.66M | ― | -93.00% | ― | -0.40% | 63.36% | |
54 Neutral | $590.83M | ― | -46.57% | ― | -2.39% | -2961.26% |
* Technology Sector Average
Performance Comparison
RSKD
Riskified
4.85
-1.14
-19.03%
YALA
Yalla Group
7.14
2.34
48.75%
DSP
Viant Technology
13.98
4.21
43.09%
BMBL
Bumble
5.97
-5.59
-48.36%
BLND
Blend Labs
3.54
0.52
17.22%
VTEX
VTEX
6.53
-0.28
-4.11%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.