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Why is Cornerstone OnDemandInc (CSOD) Investable Now?

Recently, Cornerstone OnDemandInc (NASDAQ: CSOD) reported their fourth-quarter 2020 results. CSOD shares soared 19 percent after the release, and on February 18, the stock adjusted to $ 52.50.

The growth in Cornerstone’s revenue continues to be strong. Year-on-year growth of 38.3% was achieved by Cornerstone’s revenue in the second quarter of 2015, totaling $206.9 million. Subscription sales increased by 39.6 % and accounted for the bulk of revenue (about $ 198 million). Net income was $ 1.6 million, or $ 0.02 per share, compared to $ 9.4 million and $ 0.15 a year earlier.

Subscription sales increased by 30 % by 2020 to almost $740 million. Net loss of $ 40 million, or $ 0.63 per share. Based on revenue projections for 2021, the company expects free cash flow to be between $ 195 – $ 205 million.

One of the keys to this growth was the acquisition of Saba Software, an enterprise software company specializing in talent management solutions for the cloud. As previously announced, Cornerstone and ServiceNow Inc. merged, creating a new distance learning environment.

Cornerstone OnDemandInc (CSOD) opened the lab in August, which is devoted to studying the practical application of artificial intelligence technologies.

As a niche player in the IT industry, Cornerstone does not seek to compete with the competing firms. The company designs tools for spotting talent and developing it effectively. This has led Cornerstone to seek areas of disruption. For example, the firm experimented with virtual reality technologies in 2019 to improve its employees’ skills.

Cornerstone OnDemand Inc. (CSOD) shares are up 19.21% in the year-to-date period and have moved -4.86% or -$2.68 lower in the latest trading session. While the stock’s trailing 12-month performance now stands at a negative, nearly -10.39%. Over the trailing three-month period, the stock is up 27.43%. If we look at the shorter duration, it showed a week performance increase of 11.84% and a month performance increase of 22.86%.

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