Will Docebo Stock Skyrocket to $200?

 Despite being down 55% from its all-time highs, Docebo (TSX:DCBO) still trades at a discount compared to consensus price target estimates for 2024. Since going public in late 2019, this TSX tech stock has rewarded its shareholders with an impressive 226% return, outperforming the broader index. Currently priced at just over $50 per share, Docebo has a market cap of $1.6 billion, and the big question remains: Can it reach $200 and continue delivering inflation-beating returns? 



A Closer Look at Docebo 

Founded in 2005, Docebo provides an enterprise-focused e-learning platform that has grown in popularity as companies seek innovative ways to upskill employees. Initially operating as an open-source model installed on customer servers, Docebo transitioned to a cloud-based SaaS platform over a decade ago, benefiting from recurring cash flow. 

Pioneering the integration of artificial intelligence (AI) into e-learning, Docebo offers its clients data-driven insights that enhance workforce efficiencies. This competitive edge is expected to help Docebo stay ahead in the evolving corporate training landscape. 

Impressive Revenue Growth 

In Q1 2024, Docebo reported a revenue of US$51.4 million, marking a 24% year-over-year increase. With subscription sales accounting for 93% of total revenue, the company surpassed US$200 million in annual recurring revenue. Profits are on the rise, with an adjusted EBITDA of US$7.5 million, reflecting a margin increase from 5.3% to 14.5% year-over-year. Free cash flow also improved, reaching US$9.2 million from a free cash outflow of US$2.3 million last year. 

Docebo's customer base grew to 3,833 in Q1 2024, up from 3,506 the previous year, with the average contract value increasing from US$47,034 to US$52,492. This expanding customer base and higher spending are expected to drive continued top-line growth. 

Future Prospects 

Docebo's asset-light model positions it well for benefiting from operating leverage, with adjusted earnings per share (EPS) projected to grow from $0.11 in 2023 to $0.99 in 2024 and $1.47 in 2025. Analysts are optimistic, forecasting a nearly 40% increase in DCBO stock over the next 12 months. 

To reach $200, Docebo stock would need to gain 300% from current levels. If earnings grow at 22% annually between 2025 and 2030, the EPS could reach $5 by the end of this period. Trading at $200 would then imply a price-to-earnings ratio of 50. Sustained earnings growth above 25% could make this target achievable by the end of the decade. 

  

 

Location: Canada

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