Commerce.com, Inc. (CMRC) DCF Valuation & Fundamental Primer
Commerce.com, Inc. (CMRC) trades at $15.08 with a market enterprise value of $1.35B and generated $346.9M in TTM revenue and $19.6M in free cash flow (filed 2026-08-06 (period ended 2026-06-30)). Our 5-year DCF model estimates an implied intrinsic value of $3.53 per diluted share ($391.3M DCF enterprise value, Grade: A · 78/100 · High-Quality Compounder).
SEC 10-K/10-Q DCF teardown of Commerce.com, Inc. (CMRC): $346.9M TTM revenue (11.7% growth), 77.2% GAAP gross margin, 5.6% FCF margin, 5.5% SBC/revenue, and R&D Return Grade C (Burners, $0.18 new gross profit per $1 prior R&D).
Commerce.com, Inc. (CMRC) earns a "Pass" rating and an institutional Quality Score of 78/100 (Grade A). On $346.9M in baseline revenue (11.7% growth, 77.2% gross margin, 5.6% FCF margin), our 5-year DCF yields an Enterprise Value of $391.3M ($3.53/share vs. $15.08 market price). On the R&D Return Benchmark, CMRC ranks #140 of 174 (Burners · Grade C, 0.18× return).
Gross Margin & Unit Economics: Commerce.com, Inc. operates at a 77.2% gross margin on $346.9M revenue (+4.5 pts above the Software - Application median of 72.7%).
R&D Productivity (Burners · Grade C): Investing 21.3% of revenue in R&D ($73.0M) generates $0.18 of incremental gross profit per R&D dollar (Rank #140 of 174).
Rule of 40 & Cash Conversion: Combining 11.7% top-line growth with 5.6% FCF margin yields a 17.3% Rule of 40 score (vs. 47.2% cohort median) and $391.3M DCF Enterprise Value.
3-Statement Financial Schedule & 5-Year Horizon
Synchronized directly with the 3-Year Operating Statement (77.2% Gross Margin · 11.7% Growth)
| Income Statement Line | Year 1 (2026) | Year 2 (2027) | Year 3 (2028) |
|---|---|---|---|
| Revenue | $346.9M | $387.5M | $432.9M |
| Cost of Revenue (COGS) | ($79.2M) | ($86.5M) | ($94.5M) |
| Gross Profit & Margin | $267.7M (77.2%) | $301.0M (77.7%) | $338.4M (78.2%) |
| Research & Development (R&D) | $71.2M | $76.4M | $81.8M |
| Sales & Marketing (S&M) | $140.4M | $150.6M | $161.2M |
| General & Administrative (G&A) | $54.6M | $58.6M | $62.7M |
| Operating EBIT | $1.5M (0.4%) | $15.5M (4.0%) | $32.7M (7.6%) |
| Adjusted EBITDA | $12.9M (3.7%) | $28.2M (7.3%) | $47.0M (10.9%) |
3 Key Underwriting Risks
Structural sensitivities monitored in the 3-Statement Financial Engine
Value-Creation Levers · Quantified Statement Impact
Apply any lever below to write its operating assumptions directly into the 3-Statement Model
Automate cloud hosting & support workflows to lift gross margin from 77.2% to 82.2%.
Align R&D intensity and ASC 350-40 capitalization to the R&D Compounders cohort median, recapturing $6.9M in annual EBITDA.
Lift net dollar retention and expansion velocity by +300 bps, compounding Year 3 revenue to $456.5M.
Commerce.com, Inc. (CMRC) 3-Scenario DCF Valuation Range
Stress-test CMRC's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Simulate how deploying Gemini workflow automation and autonomous engineering expands CMRC's Gross Margin, FCF Margin, DCF share price, and 2x2 R&D Return Quadrant.
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: $15.08).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $8.11 -46% | $8.69 -42% | $9.37 -38% | $10.16 -33% | $11.12 -26% |
| 9.3% | $7.17 -52% | $7.63 -49% | $8.15 -46% | $8.76 -42% | $9.47 -37% |
| 10.0% | $6.40 -58% | $6.76 -55% | $7.18 -52% | $7.65 -49% | $8.20 -46% |
| 10.8% | $5.75 -62% | $6.05 -60% | $6.38 -58% | $6.76 -55% | $7.19 -52% |
| 11.5% | $5.20 -66% | $5.45 -64% | $5.72 -62% | $6.03 -60% | $6.38 -58% |
Institutional Software Quality Scorecard (78/100 · Grade A)
Strong fundamentals, above-average cash generation, and robust competitive positioning.
Elite deferred revenue float; FCF exceeds operating income by >20%
Disciplined equity compensation well below software industry average
Solid gross margins with potential for operating leverage at scale
Manageable debt load covered by recurring positive free cash flow
Core Investment Strengths & Moats
- High-grade cash conversion: FCF is 1346% of EBIT driven by upfront annual collections
Key Operational & Dilution Risks
Audited R&D Intensity is 21.3% of revenue with a 0.18× incremental gross profit return per R&D dollar. Under your current Stage 1 (11.7% CAGR / 77.2% GM) assumptions, CMRC projects to 0.35× R&D Return (Grade CCC · Burners).
Reverse-DCF Solver: What Growth is Priced Into CMRC?
The current share price demands 46.0% 5-year CAGR (48.4% net of SBC & dilution)—a +34.3% acceleration over historical run-rate (11.7%). Any growth slowdown risks valuation multiple contraction.
Headline Reverse-DCF ignores Stock-Based Compensation (5.5% of revenue) and annual share dilution (3.0%/yr). Accounting for both requires 48.4% 5-year revenue CAGR to justify $15.08/sh on a true per-share economic cash flow basis.
Commerce.com, Inc. (CMRC) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $346.9M | $346.9M | $387.5M | $432.9M | $483.6M | $540.2M | $603.5M |
| Gross Profit | $267.7M | $267.7M | $299.0M | $334.1M | $373.2M | $416.9M | $465.7M |
| Operating Income (EBIT) | $1.5M | $1.5M | $1.6M | $1.8M | $2.0M | $2.3M | $2.5M |
| Stock-Based Compensation (SBC) | $19.1M | $19.1M | $21.4M | $23.9M | $26.7M | $29.8M | $33.3M |
| Unlevered Free Cash Flow (FCF) | $19.6M | $19.6M | $21.9M | $24.4M | $27.3M | $30.5M | $34.0M |
| SBC-Adjusted True Cash Flow | $410.0K | $416.3K | $465.0K | $519.5K | $580.3K | $648.3K | $724.2K |
Software - Application Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = 6.9 + 0.05 × (Rule of 40) · R² = 12%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 |
|---|---|---|---|---|---|---|---|---|
| Commerce.com, Inc. | CMRC | $1.25B | $346.9M | 77.2% | 5.6% | 17.4% | 5.5% | 3.9× |
| Grab Holdings Limited | GRAB | $20.18B | $2.80B | 42.0% | 27.7% | 84.0% | 10.0% | 6.3× |
| Figma, Inc. | FIG | $18.07B | $749.0M | 88.3% | -9.2% | 39.1% | 126.5% | 23.5× |
| Full Truck Alliance Co. Ltd. | YMM | $71.73B | $11.24B | 86.6% | 25.8% | 70.2% | 4.4% | 5.9× |
| ServiceTitan, Inc. | TTAN | $9.97B | $771.9M | 64.9% | 2.0% | 30.5% | 21.2% | 12.5× |
| InterDigital, Inc. | IDCC | $8.65B | $868.5M | 80.5% | 30.6% | 55.3% | 5.3% | 9.9× |
| OPEN TEXT CORP | OTEX | $8.11B | $5.30B | 63.5% | 13.0% | 23.8% | 2.0% | 2.6× |
| Peer Cohort Median Benchmark (N=6) | 72.7% | 19.4% | 47.2% | 7.6% | 8.1× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 3.9× | $1.35B | $1.25B | $15.08 | 0.0% |
| -20% Multiple Compression | 3.1× | $1.08B | $978.9M | $11.82 | -20.0% |
| -35% Multiple Compression | 2.5× | $876.1M | $776.7M | $9.38 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $1.73B | $1.64B | $19.75 | +28.7% |
Frequently Asked Questions: Commerce.com, Inc. (CMRC) Valuation
What is Commerce.com, Inc. (CMRC)'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, Commerce.com, Inc. (CMRC) has a Base Case implied value of $3.53 per share (with a Bear Case of $1.19 and a Bull Case of $6.40), compared to its current price of $15.08. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is Commerce.com, Inc. (CMRC)'s Rule of 40 score and Free Cash Flow margin?
Commerce.com, Inc. achieves a Rule of 40 score of 17.4%, combining a 11.7% revenue growth run-rate with a 5.6% TTM free cash flow margin on $346.9M in trailing twelve-month revenue. In the Software - Application peer cohort, the median Rule of 40 benchmark is 47.2%.
What revenue growth rate is priced into CMRC stock according to Reverse-DCF analysis?
At $15.08 per share (Enterprise Value of $1.35B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 46.0%, compared to Commerce.com, Inc.'s historical CAGR of 11.7%. Overall market expectations are rated as "Aggressive Growth Expectations Priced In".
What is Commerce.com, Inc. (CMRC)'s R&D Return Score and innovation productivity?
On the Golden Door Software R&D Return Benchmark, Commerce.com, Inc. (CMRC) is ranked #140 out of 174 scored software peers, earning a Grade C in the "Burners" quadrant. Commerce.com, Inc. invests 21.3% of FY revenue into R&D ($73.0M) and generated $0.18 of incremental gross profit per prior-year R&D dollar.
How does Commerce.com, Inc. compare to Software - Application peers?
Commerce.com, Inc. (CMRC) earns an institutional Software Quality Score of 78/100 (Grade A — High-Quality Compounder). Across its Software - Application peer group (GRAB, FIG, YMM, TTAN, IDCC), the cohort trades at a median EV/TTM Revenue multiple of 8.1× and a median gross margin of 72.7%.
How does Stock-Based Compensation (SBC) impact Commerce.com, Inc. (CMRC)'s valuation?
Commerce.com, Inc. recorded $19.1M in TTM stock-based compensation (5.5% of revenue). When treating SBC as a cash-equivalent compensation expense, Commerce.com, Inc.'s SBC-adjusted free cash flow yield is 0.0%, scoring 21/25 on our Shareholder Dilution Friction pillar.