BlackSky Technology Inc. (BKSY) DCF Valuation & Fundamental Primer
BlackSky Technology Inc. (BKSY) currently trades at $22.72 with an enterprise value of $1.40B. Our proprietary institutional model rates BlackSky Technology Inc. at 82/100 (Grade: A · High-Quality Compounder). The current market price prices in an implied 5-year revenue CAGR of 11.1% vs. historical growth of 28.4% (Substantial Margin of Safety).
Institutional fundamental teardown of BlackSky Technology Inc. (BKSY) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
BlackSky Technology Inc. (BKSY) 3-Scenario DCF Valuation Range
Stress-test BKSY's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: $22.72).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $46.27 +104% | $49.15 +116% | $52.50 +131% | $56.46 +149% | $61.22 +169% |
| 9.3% | $41.62 +83% | $43.88 +93% | $46.48 +105% | $49.50 +118% | $53.04 +133% |
| 10.0% | $37.80 +66% | $39.62 +74% | $41.68 +83% | $44.04 +94% | $46.76 +106% |
| 10.8% | $34.61 +52% | $36.09 +59% | $37.76 +66% | $39.65 +75% | $41.79 +84% |
| 11.5% | $31.90 +40% | $33.14 +46% | $34.51 +52% | $36.04 +59% | $37.76 +66% |
Institutional Software Quality Scorecard (82/100 · Grade A)
Strong fundamentals, above-average cash generation, and robust competitive positioning.
Elite deferred revenue float; FCF exceeds operating income by >20%
Elevated equity dilution; SBC consumes substantial operating cash flow
Elite Tier-1 SaaS compounder with high gross margin and superior Rule of 40
Positive net cash cushion; self-funding operations with zero insolvency risk
Core Investment Strengths & Moats
- High-grade cash conversion: FCF is 195% of EBIT driven by upfront annual collections
- Top-quartile software unit economics: 81.3% gross margin and 60.4% Rule of 40 score
- Net cash positive: $87.9M balance sheet buffer
Key Operational & Dilution Risks
- Substantial SBC dilution drag: SBC is 20.7% of revenue ($24.0M)
Reverse-DCF Solver: What Growth is Priced Into BKSY?
The current share price only requires 11.1% 5-year CAGR (23.7% dilution-adjusted), well below historical growth of 28.4%. If the company maintains baseline execution, there is asymmetric upside.
Headline Reverse-DCF ignores Stock-Based Compensation (20.7% of revenue) and annual share dilution (1.8%/yr). Accounting for both requires 23.7% 5-year revenue CAGR to justify $22.72/sh on a true per-share economic cash flow basis.
BlackSky Technology Inc. (BKSY) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $115.9M | $115.9M | $148.8M | $191.0M | $245.2M | $314.9M | $404.3M |
| Gross Profit | $94.2M | $94.2M | $120.9M | $155.3M | $199.4M | $256.0M | $328.7M |
| Operating Income (EBIT) | $19.0M | $19.0M | $24.4M | $31.3M | $40.2M | $51.6M | $66.3M |
| Stock-Based Compensation (SBC) | $24.0M | $24.0M | $30.8M | $39.5M | $50.8M | $65.2M | $83.7M |
| Unlevered Free Cash Flow (FCF) | $37.1M | $37.1M | $47.6M | $61.1M | $78.5M | $100.8M | $129.4M |
| SBC-Adjusted True Cash Flow | $13.1M | $13.1M | $16.8M | $21.6M | $27.7M | $35.6M | $45.7M |
Software & Cloud Services Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = -14.0 + 0.47 × (Rule of 40) · R² = 31%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| BlackSky Technology Inc. | BKSY | $811.0M | $115.9M | 81.3% | 32.0% | 60.4% | 20.7% | 6.2× |
| ServiceNow | NOW | $152.61B | $10.98B | 79.2% | 31.1% | 54.2% | 15.9% | 13.9× |
| Workday, Inc. | WDAY | $50.35B | $8.00B | 75.0% | 27.4% | 43.9% | 19.0% | 6.4× |
| Salesforce | CRM | $217.10B | $37.90B | 77.2% | 32.8% | 42.8% | 8.4% | 5.8× |
| Datadog | DDOG | $46.05B | $2.68B | 80.8% | 31.1% | 57.7% | 21.3% | 17.4× |
| Snowflake Inc. | SNOW | $71.79B | $3.63B | 66.5% | 25.2% | 57.7% | 40.8% | 20.0× |
| Hubspot | HUBS | $19.89B | $2.63B | 85.0% | 21.3% | 52.7% | 19.2% | 7.7× |
| Peer Cohort Median Benchmark (N=6) | 78.2% | 29.2% | 53.5% | 19.1% | 10.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 6.2× | $723.0M | $811.0M | $22.72 | 0.0% |
| -20% Multiple Compression | 5.0× | $578.4M | $666.4M | $18.67 | -20.0% |
| -35% Multiple Compression | 4.1× | $470.0M | $557.9M | $15.63 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $579.3M | $667.2M | $18.69 | -19.9% |
Frequently Asked Questions: BlackSky Technology Inc. (BKSY) Valuation
What is BlackSky Technology Inc. (BKSY)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, BlackSky Technology Inc. (BKSY) has a Base Case implied value of $41.68 per share (with a Bear Case of $17.07 and a Bull Case of $79.40), compared to its current price of $22.72. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is BlackSky Technology Inc. (BKSY)'s Rule of 40 score and Free Cash Flow margin?
BlackSky Technology Inc. achieves a Rule of 40 score of 60.4%, combining a 28.4% revenue growth run-rate with a 32.0% TTM free cash flow margin on $115.9M in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.
What revenue growth rate is priced into BKSY stock according to Reverse-DCF analysis?
At $22.72 per share (Enterprise Value of $723.0M), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 11.1%, compared to BlackSky Technology Inc.'s historical CAGR of 28.4%. Overall market expectations are rated as "Substantial Margin of Safety".
How does BlackSky Technology Inc. compare to Software & Cloud Services software peers?
BlackSky Technology Inc. (BKSY) earns an institutional Software Quality Score of 82/100 (Grade A — High-Quality Compounder). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.
How does Stock-Based Compensation (SBC) impact BlackSky Technology Inc. (BKSY)'s valuation?
BlackSky Technology Inc. recorded $24.0M in TTM stock-based compensation (20.7% of revenue). When treating SBC as a cash-equivalent compensation expense, BlackSky Technology Inc.'s SBC-adjusted free cash flow yield is 1.6%, scoring 10/25 on our Shareholder Dilution Friction pillar.