Should I invest in HubSpot?

Is this SaaS stock the next Salesforce?

HubSpot is soaring to the moon this week after announcing a fresh new software offering, but have investors missed the boat on this one?

Since Monday, HubSpot (NYSE: HUBS) shares have soared more than 15%, bringing its market cap just shy of $37 billion. 

With its valuation having doubled so far in 2021, have investors missed the boat?

HubSpot still has a long runway. 

The very cause of its recent growth is also reason to be hugely optimistic about HubSpot’s growth potential — as should be the case when it comes to innovation. 

On Tuesday, the company ripped through the market after unveiling HubSpot Payments, a proprietary digital end-to-end payment solution built into the HubSpot ecosystem. The move makes a lot of sense for a company like HUBS, which specializes in the development of software products for inbound marketing, sales, and customer service. 

Adding payments to the mix creates a perfectly symmetrical lifecycle for its products. 

While several other products were announced alongside HubSpot Payments, this seems to be the big fish. Despite numerous competitors, HubSpot’s existing 121,000+ customers form a strong base for the product to be utilized — helped by the fact the company will waive the fees for the first $50,000 of electronic transactions processed each month.

Hopefully, The payments business will generate another high-quality revenue stream for HubSpot, while potentially improving its margins and boosting customer retention. HubSpot is also on track to surpass $1 billion in total revenue in a fiscal year for the first time, based on trailing 12-month figures. 

Boasting a strong CAGR since its IPO in 2014, these innovative plans really do beg the question; could HubSpot become a mega-cap SaaS company like Salesforce? Only time will tell…

Not too bad $HUBS

For a $37 billion company, this is a tasty-looking CAGR. Taken from HubSpot’s Q2 2021 earnings report.

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