Is Five9 (FIVN) a Good Long-Term Investment?


RiverPark Funds, an investment management company, released its “RiverPark Large Growth Fund” third quarter 2022 investor letter — a copy of which can be downloaded here. For the quarter, the RiverPark Large Growth Fund (the “Fund”) lost 3.3% – a bit better than the S&P 500 (-4.9% for the quarter) and about in line with the Russell 1000 Growth index (-3.6% for the quarter). Try to spare some time to check the fund’s top 5 holdings for you to have an idea about their best stock picks this 2022.

In its Q3 2022 investor letter, RiverPark Large Growth Fund mentioned Five9, Inc. (NASDAQ:FIVN) and explained his insights for the company. Founded in 2001, Five9, Inc. (NASDAQ:FIVN) is a San Ramon, California-based cloud contact center solutions provider with a $3.8 billion market capitalization. Five9, Inc. (NASDAQ:FIVN) delivered a -59.52% return since the beginning of the year, while its 12-month returns are down by -65.35%. The stock closed at $55.59 per share on October 19, 2022.

Here is what RiverPark Large Growth Fund has to say about Five9, Inc. (NASDAQ:FIVN) in its Q3 2022 investor letter:

Five9 is a leader in providing cloud-based software to contact centers. The company’s suite of applications provides contact center agents a unified communication platform (voice, email, text, chat, web, social) and a desktop of tools (including core CRM data base utilization, artificial intelligence to guide agents to next actions and a host of reporting tools) to help agents engage customers more quickly and effectively. FIVN is well-positioned as contact centers transitioning to the cloud with high customer retention (120% last quarter), the doubling of its strategic sales team over the past year, and new partnerships, including with AT&T, CDW and Microsoft. We believe the company can grow its top-line at more than 20% annually, improve its 60% gross margins, and expand EBITDA margin to more than 20%, all of which should lead to 30%+ EPS growth for the foreseeable future. The company should turn FCF-positive this year and continue to expand its FCF growth in the years to come given its highly capital efficient business model.”

Our calculations show that Five9, Inc. (NASDAQ:FIVN) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Five9, Inc. (NASDAQ: FIVN) was in 51 hedge fund portfolios at the end of the second quarter of 2022, compared to 52 funds in the previous quarter. Five9, Inc. (NASDAQ:FIVN) delivered a -46.74% return in the past 3 months.

In June 2021, we also shared another hedge fund’s views on Five9, Inc. (NASDAQ:FIVN) in another article. You can find other investor letters from hedge funds and prominent investors on our website hedge fund investor letters 2022 Q3 page.

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Disclosure: None. This article was originally published at Insider Monkey.



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