Riskified (RSKD) AI Stock Analysis

• Market Cap: $789.71M
• Dividend Yield: N/A
• Average Volume (3M): 425.50K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.06
• Revenue Growth: 9.30%
• EPS Growth: 24.96%
• Country: US
• Employees: 652
• Sector: Technology
• Sector Strength: 91
• Industry: Software - Application
• EPS (TTM): -0.09
• Shares Outstanding: 112,781,640
• 10 Day Avg. Volume: 468,907
• 30 Day Avg. Volume: 425,500
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 0.53
• Enterprise Value/Revenue: 1.25
• Enterprise Value/Gross Profit: 2.46
• Enterprise Value/Ebitda: -9.36
• 1Y Price Target: $6.15
• Price Target Upside: 24.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 63 Neutral
• Price Target: $5.50 ▲(11.56%Upside)

Riskified's stock score is bolstered by strong earnings call results and robust financial performance, particularly in revenue growth and adjusted EBITDA. However, technical signals indicate bearish momentum, and valuation concerns due to negative net income weigh heavily. Investors should be wary of the company's profitability challenges and macroeconomic pressures impacting certain business segments.

Positive Factors

Financial Performance

March-quarter results exceeded expectations, with revenue growing 8% to $82.4 million and adjusted EBITDA reaching $1.3 million.

New Product Growth

Growth of newer, higher-margin solutions such as Policy Protect, Dispute Resolve, Account Secure, and Policy Decisions has been encouraging.

Negative Factors

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.

Revenue Headwinds

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.

Riskified Business Overview & Revenue Model

Company Description

Riskified 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 Money

Riskified makes money primarily through a revenue model based on transaction fees and service subscriptions. The company charges merchants a fee for each transaction processed through its platform, which is typically a percentage of the transaction value. This fee structure incentivizes merchants to use Riskified's services as it aligns the company's success with the merchant's revenue growth. Additionally, Riskified may offer subscription-based services that provide merchants with access to its suite of tools and analytics for ongoing fraud prevention and risk management. Strategic partnerships with payment processors and e-commerce platforms also play a crucial role in expanding Riskified's customer base and enhancing its service offerings, contributing to its overall earnings.

Riskified Financial Statement Overview

Summary

Riskified shows strong revenue growth and a solid equity base, but faces challenges with profitability due to consistent net losses and high operational costs. The robust balance sheet with low leverage and healthy gross margin are positives, yet the reliance on external financing and negative net income are concerns.

Income Statement

The company has demonstrated a consistent increase in revenue over the years with TTM revenue reaching $333.5 million, showing a 1.83% growth from the previous annual report. However, the company continues to operate at a net loss, with a TTM net profit margin of -11.15%. Gross profit margin remains healthy at 50.76% in the TTM, indicating strong product profitability, although EBIT and EBITDA margins are negative due to high operational costs.

Balance Sheet

Riskified maintains a strong equity position with a debt-to-equity ratio of 0.07, indicating low leverage. The equity ratio is 78.14%, reflecting a robust financial structure with significant shareholder equity. However, the company has been experiencing declining stockholders' equity, which may pose a risk if the trend continues.

Cash Flow

The company has shown positive free cash flow growth in recent periods, with a TTM free cash flow of $32.1 million, despite a decline from the previous annual report. Operating cash flow to net income ratio is positive, suggesting that cash flow generation is healthier than reported accounting losses. However, reliance on financing activities to support operations may not be sustainable long-term.

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
EBITDA	-42.97M	-71.75M	-108.63M	-55.40M	-5.45M
Net Income	-34.92M	-59.03M	-103.99M	-178.88M	-11.35M
Balance Sheet
Total Assets	495.86M	601.93M	608.97M	600.63M	180.56M
Cash, Cash Equivalents and Short-Term Investments	376.06M	474.81M	475.67M	503.27M	117.62M
Total Debt	27.53M	31.31M	37.42M	0.00	0.00
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

• Technical Analysis Sentiment: Negative
• Last Price: 4.93
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RSKD, the sentiment is Negative. The current price of 4.93 is below the 20-day moving average (MA) of 5.25, below the 50-day MA of 5.10, and above the 200-day MA of 4.88, indicating a neutral trend. The MACD of 0.03 indicates Positive momentum. The RSI at 38.74 is Neutral, neither overbought nor oversold. The STOCH value of 6.40 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RSKD.

Riskified Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YALA	81 Outperform	$1.19B	9.83	21.03%	―	6.40%	9.72%
DSP	70 Neutral	$852.78M	452.82	4.15%	―	30.64%	―
Sector *	69 Neutral	¥234.01B	14.95	7.54%	2.58%	9.26%	5.89%
VTEX	67 Neutral	$1.06B	70.01	6.26%	―	7.71%	―
RSKD	63 Neutral	$789.71M	―	-9.00%	―	9.30%	24.96%
BMBL	56 Neutral	$783.98M	―	-46.57%	―	-2.39%	-2961.26%
BLND	53 Neutral	$920.34M	―	-93.00%	―	-0.40%	63.36%