Gitlab, the code repository firm, is valued at 17.73 billion USD after its Initial Public Offering on Nasdaq.
I believe Gitlab's intrinsic worth is around 3.4 billion USD.
And this is based on my assumption that Gitlab will become a profitable company. At 150 million USD of Fiscal 2021 revenue Gitlab has simply too little revenue to justify a market capitalisation of above 3.4 billion USD.
Yes, the infrastructure as a service cloud computing market in which Gitlab is operating may well grow above 500 billion USD in revenue in 2025, but there are other formidable entrenched competitors like Microsoft, Amazon, Oracle and IBM which have huge research and development resources and already command significant market shares. Microsoft and Amazon, especially, have a huge edge with their 13 % market share each in the infrastructure as a service(IAAS) market.
At best, Gitlab could be described as a niche player in the IAAS market. Even if Gitlab proves another spectacular technology rising star success a 3.4 billion USD long-term intrinsic value should be enough compensation for that.
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