Section 1: Company Overview and Fundamentals

1.1 Company Overview:

GitLab Inc. runs a DevOps platform that provides a single application, that unites teams from the development, operations, information technology, security, and business sectors. A single codebase, consistent data model, and user interface make up the DevOps Platform.             

1.2 The Key Positives, Negatives, and Investment summary

1.3 Key Metrics:

In the preceding three years, GTLB's revenues more than tripled, and each of those years had an exceptional gross margin of above 87%. In addition to having stronger short-term liquidity than its competitors, GTLB has no leverage. Compared to the industry median of 1.81x in Q2FY23, GTLB's current ratio in Q2FY23 was 4.31x.

1.4 Top 10 shareholders:

The top 10 shareholders together form ~50.11% of the total shareholding, signifying concentrated shareholding. ICONIQ Capital, LLC and August Capital are the biggest shareholders, holding the maximum stake in the company at ~11.23% and ~10.19%, respectively.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates:

The below picture gives an overview of the recent updates:

 2.2 Insights of Q2FY23:

Section 3: Key Risks

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Multiple-Based Relative Valuation

Markets are trading in a highly volatile zone currently due to certain macroeconomic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance. 

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is November 21, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: The report publishing date is as per the Pacific Time Zone.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavorable movement in the stock prices.