MongoDB, Inc. (NASDAQ:MDB) is a leading player in the database management industry, known for its innovative cloud-based solutions. The company provides a modern, general-purpose database platform designed to unleash the power of software and data for developers and the applications they build. MongoDB competes with other tech companies like Okta, Datadog, Zscaler, Atlassian, and Twilio.
In evaluating MongoDB's financial performance, the Return on Invested Capital (ROIC) and Weighted Average Cost of Capital (WACC) are crucial metrics. MongoDB's ROIC is -5.15%, while its WACC is 10.25%, resulting in a ROIC to WACC ratio of -0.50. This negative ratio indicates that MongoDB is not generating returns that exceed its cost of capital, suggesting inefficiencies in capital utilization.
When comparing MongoDB to its peers, Okta, Inc. (OKTA) emerges as the most efficient in capital utilization. Okta's ROIC is 1.36% against a WACC of 7.09%, resulting in a ROIC to WACC ratio of 0.19.
Other peers like Datadog, Zscaler, and Atlassian also show negative ROIC to WACC ratios, similar to MongoDB. Datadog has a ROIC of -0.78% and a WACC of 9.46%, resulting in a ratio of -0.08. Zscaler's ROIC is -3.00% with a WACC of 8.30%, leading to a ratio of -0.36. Atlassian's ROIC is -6.72% against a WACC of 7.79%, resulting in a ratio of -0.86.
These figures indicate that these companies are also not generating sufficient returns to cover their cost of capital. Twilio Inc. (TWLO) shows a slightly positive ROIC to WACC ratio of 0.11, with a ROIC of 1.08% and a WACC of 9.60%. While this is better than MongoDB, it still suggests room for improvement in capital utilization. Overall, the analysis highlights the importance of efficient capital management in driving financial performance and investor confidence.
