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Alteryx: Come, Play In The Data Analytics Sandbox

Jun. 01, 2020 5:30 AM ETAlteryx, Inc. (AYX)63 Comments


  • Data is the most valuable asset in the digital economy. Alteryx's platform provides analytic process automation tools to data scientists and analysts, thereby enabling firms to maximize their data assets.
  • Alteryx's product offering is highly valued and uniquely differentiated, as evidenced by the explosive revenue growth (3-YR: +65% CAGR) and gross margins of more than 90%.
  • According to Gartner's 2020 Magic Quadrant, Alteryx is a leader among Data Science and Machine learning platforms with the highest execution ability.
  • The projected return on a ten-year investment in Alteryx is ~14.2% CAGR if one were to buy at $150 (this is with a solid margin of safety implemented).
  • Hence, I rate Alteryx a buy at $150 and below.
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Source: www.alteryx.com

Investment Thesis

Alteryx (NYSE:AYX) is improving business through advanced data analytics by empowering businesses, regardless of technical acumen, to quickly and easily transform raw data into actionable insights and deliver improved data-driven business outcomes.

Alteryx's users leverage its end-to-end analytic platform to quickly and easily find, access, prepare, and analyze data from multiple sources, then deploy and share analytics at scale. The sophistication, speed, and ease-of-use that Alteryx's platform provides are enhanced through very intuitive and highly repeatable visual workflows.

In layman terms, the company offers a platform where you can utilize data analytics tools to maximize the power of your organization's data assets. In the 21st century, the philosophy 'good data beats opinion' has become crucial in the success of businesses.

Nowadays, micro-level data analysis helps business managers to identify the KPIs (key performance indicators) that influence business revenues, profits, and costs; thus, enabling enterprises to make smart data-driven decisions rather than decisions based on opinions.

As more companies begin treating data as an enterprise-wide corporate asset, sharing of data about products and customers creates opportunities to up-sell and cross-sell, while improving retention rates and customer service.

By combining internal and external data, every company in the world can develop new products and services across lines of business. As a result, the need for data analytics and machine learning tools has never been higher than what it is today.

Alteryx is a leading platform in the data analytics and machine learning space, with revenues growing at +65% CAGR over the last three years. Furthermore, the demand for the Alteryx platform is only going to accelerate in the near future, as companies undergo digital transformation and embrace data.

Alteryx's APA platform is uniquely differentiated, which is evident in its gross margins of 90%+. The business is run prudently, i.e., even in its

Alteryx: Come, Play In The Data Analytics Sandbox

This article was written by

Louis Stevens profile picture
A community achieving financial freedom through visionary investing
I buy businesses I like, then hold them with a long term time horizon.

Some credentials of mine: Former U.S. Army Officer, Political Science Florida Atlantic, MBA University of Florida, inventor of the L.A. Stevens Valuation Model.

Analyst’s Disclosure: I am/we are long AYX, TWLO, GOOG, FB, AMZN. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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