UPWK - Embedded Expectations Analysis - 2020 05 04
Upwork Inc. (UPWK:USA) currently trades well above corporate averages relative to UAFRS-based (Uniform) earnings, with a 116.3x Uniform P/E. Even at these levels, the market is pricing in expectations for Uniform ROA to remain flat, and management may be concerned about their Connects business, cloud computing costs, and profitabilitySpecifically, management may have concerns about revenue pressure from Connects business adjustments, the immediate impact of pricing or monetization changes, and the effect of ASC 606 on their reported results. In addition, management may lack confidence in their ability to meet their wallet retention rate target, sustain reductions in cloud computing costs, and capitalize on enterprise market changes. Furthermore, they may be exaggerating their ability to be highly profitable, deliver higher-quality talent more quickly, and weather economic downturns. Finally, management may have concerns about the progress of their 2020 sales force hiring plan, and they may lack confidence in their ability to sustain their net promoter score performance
UPWORK operates an online talent marketplace, which enables businesses to find and work with independent personnel. Freelancers on the company's platform include independent personnel and agencies of varying sizes. The company's marketplace offerings include Upwork Basic, Upwork Plus, Upwork Business, Upwork Enterprise, and Upwork Payroll. The company,'s Upwork Basic offering provides clients with access to freelance talent with verified work history on its platform and client feedback, the ability to match with the freelancers, and built-in collaboration features. The company's Upwork Plus provides all the product features of Upwork Basic, as well as access to personalized assistance, whether strategic or job-specific.
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
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