SPS Commerce: Interesting TAM Expansion And Appears Undervalued

Tech and Growth
3.52K Followers

Summary

  • SPS Commerce offers cloud-based SCM software and has delivered strong returns since its IPO, despite recent share price corrections.
  • SPSC's fundamentals are solid, with steady revenue growth, profitability, and expanding operating cash flow, making it a decent growth stock.
  • Future growth catalysts include recurring revenue from acquisitions and tapping into Amazon's FBA seller ecosystem, presenting significant TAM opportunities.
  • My conservative price target of $149.6 per share projects a 15% upside YoY, justifying a buy rating for SPSC.

Male and female worker working at conveyor belt

Klaus Vedfelt/DigitalVision via Getty Images

SPS Commerce (NASDAQ:SPSC) is a company providing supply chain management (SCM) cloud-based software in retail and logistics industries.

Overall share performance since going public in 2010 has been solid overall. Since the debut, the stock has delivered

This article was written by

3.52K Followers
We're a long-only asset manager allocating into tech and growth asset classes. Learn more at www.tnginvestments.com

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in SPSC over the next 72 hours. 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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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