Research HubSoftware & Cloud ServicesLightspeed Commerce Inc. (LSPD)

Coverage:KVYO DDOG CRWD NOW SNOW PLTR ADBE CRM PANW NET SHOP MDB

SEC 10-K / 10-Q Equity ResearchSoftware & Cloud ServicesTicker: LSPD

Lightspeed Commerce Inc. (LSPD) DCF Valuation & Fundamental Primer

Lightspeed Commerce Inc. (LSPD) currently trades at $12.06 with an enterprise value of $-4.17B. Our proprietary institutional model rates Lightspeed Commerce Inc. at 46/100 (Grade: C · Capital Intensive / Low Margin). The current market price prices in an implied 5-year revenue CAGR of -13.1% vs. historical growth of 48.5% (Substantial Margin of Safety).

GDA Quality Score

C46/100

Capital Intensive / Low Margin

Share Price / DCF Base

$12.06 / -$26.68

Enterprise Value

$1.10B

TTM Revenue

$1.08B (+48.5%)

Gross Margin

41.8%

Rule of 40 Score

43.3%

EV / TTM Revenue

1.0×

Structural Moat: Enterprise Software & Cloud Services Switching Costs & Recurring Workflow Integration

Key Growth Catalyst: AI workflow automation, multi-module expansion across enterprise cohorts, and operating margin leverage at Lightspeed Commerce Inc..

Institutional fundamental teardown of Lightspeed Commerce Inc. (LSPD) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.

Seed LSPD in Interactive 3-Statement Model

Section 1 · Intrinsic Valuation Engine

Lightspeed Commerce Inc. (LSPD) 3-Scenario DCF Valuation Range

WACC: 10.0% · Terminal Growth: 2.5% · Diluted Shares: 136.0M

bear Case DCFSensitivity

-$4.41

Implied Equity Value:$-599.3M

base Case DCFPrimary Benchmark

-$26.68

Implied Equity Value:$-3.63B

bull Case DCFSensitivity

-$67.83

Implied Equity Value:$-9.22B

Interactive What-If DCF SandboxSim Rule of 40: 58.5%

Stress-test LSPD's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.

Seed Custom Drivers in /model

1-Click Regimes:

5Y Revenue CAGR48.5%

2%Hist: 48.5%50%

Target FCF Margin10.0%

5%Base: 10%45%

WACC Discount Rate10.0%

6.5%Base: 10%14.5%

Terminal Growth (g)2.5%

1.0%Implies 13.7× Y5 FCF4.0%

Accounting Lens:

Simulated Implied Price$63.15

Spread vs Market+423.6%

Simulated EV$8.05B

Effective FCF Margin10.0%

Simulated 5-Year Cash Flow Trajectory (Unlevered FCF vs. Discounted PV)Cumulative 5Y PV: $1.45B

Year 1$1.60B

FCF:$159.9M

PV:$145.4M

Year 2$2.37B

FCF:$237.5M

PV:$196.3M

Year 3$3.53B

FCF:$352.6M

PV:$264.9M

Year 4$5.24B

FCF:$523.7M

PV:$357.7M

Year 5$7.78B

FCF:$777.6M

PV:$482.9M

Enterprise Value Composition Bridge$8.05B

Split between 5-Year Explicit Cash Flows and Discounted Terminal Value

5Y Explicit PV: $1.45B (18.0%)Terminal PV: $6.60B (82.0%)

(+) Balance Sheet Cash & Equivalents+$558.5M

(−) Total Debt Obligations−$17.0M

(=) Implied Equity Value (136.0M shs)$8.59B

2D Institutional Valuation Sensitivity Heatmap

Implied share price & upside/downside spread across 25 valuation states (Current Price: $12.06).

WACC \ Terminal	1.5%	2.0%	2.5%	3.0%	3.5%
8.5%	$70.31 +483%	$74.84 +521%	$80.13 +564%	$86.38 +616%	$93.89 +678%
9.3%	$63.01 +422%	$66.58 +452%	$70.68 +486%	$75.44 +526%	$81.03 +572%
10.0%	$57.02 +373%	$59.90 +397%	$63.15 +424%	$66.87 +454%	$71.16 +490%
10.8%	$52.03 +331%	$54.38 +351%	$57.01 +373%	$59.98 +397%	$63.37 +425%
11.5%	$47.80 +296%	$49.75 +313%	$51.91 +330%	$54.33 +351%	$57.05 +373%

Section 2 · Fundamental Underwriting

Institutional Software Quality Scorecard (46/100 · Grade C)

Capital Intensive / Low Margin

Weak cash conversion, substantial dilution drag, or constrained financial flexibility.

Cash Conversion5 / 25

Actual: NegativeTarget: Target: ≥100%

Negative free cash flow; business consumes cash to sustain operations

Dilution Friction21 / 25

Actual: 5.2% of RevTarget: Target: ≤8%

Disciplined equity compensation well below software industry average

Unit Economics8 / 25

Actual: 42% GM / R40: 43%Target: Target: ≥75% GM / ≥40% R40

Sub-par gross margins; higher cost of delivery or hardware/services mix

Balance Sheet12 / 25

Actual: +$541.5M Net CashTarget: Target: Net Cash > 0

Moderate leverage or cash burn; monitor liquidity runway

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Negative free cash flow burn of $-55.9M over trailing twelve months
Lower software gross margins (41.8%), indicating higher hosting or service delivery drag

Section 3 · Expectations Investing

Reverse-DCF Solver: What Growth is Priced Into LSPD?

Substantial Margin of Safety

The current share price only requires -13.1% 5-year CAGR (-8.0% dilution-adjusted), well below historical growth of 48.5%. If the company maintains baseline execution, there is asymmetric upside.

Implied 5-Year Revenue CAGR

-13.1%

Required to justify $1.10B EV

Historical Run-Rate CAGR

48.5%

Audited multi-year top-line trajectory

Growth Hurdle Spread

-61.6%

Implied hurdle minus historical growth

Implied FCF Margin @ Hist. Growth

1.4%

Steady-state FCF margin needed at current CAGR

Institutional Dilution-Adjusted Hurdle Lens

Headline Reverse-DCF ignores Stock-Based Compensation (5.2% of revenue) and annual share dilution (0.6%/yr). Accounting for both requires -8.0% 5-year revenue CAGR to justify $12.06/sh on a true per-share economic cash flow basis.

True Economic Hurdle-8.0%

SBC & Dilution Hurdle Tax+5.1% / yr

Section 4 · 5-Year Forecast Schedule

Lightspeed Commerce Inc. (LSPD) 5-Year Fundamental Forecast

Customize in Live Engine

Statement Line Item	TTM Audited Base	TTM	Y1	Y2	Y3	Y4	Y5
Revenue	$1.08B	$1.08B	$1.60B	$2.37B	$3.52B	$5.23B	$7.76B
Gross Profit	$450.2M	$450.2M	$668.4M	$992.2M	$1.47B	$2.19B	$3.25B
Operating Income (EBIT)	$-696.0M	$-696.1M	$-1.03B	$-1.53B	$-2.28B	$-3.38B	$-5.02B
Stock-Based Compensation (SBC)	$55.6M	$55.6M	$82.5M	$122.4M	$181.8M	$269.8M	$400.6M
Unlevered Free Cash Flow (FCF)	$-55.9M	$-55.9M	$-83.0M	$-123.2M	$-182.8M	$-271.4M	$-402.9M
SBC-Adjusted True Cash Flow	$-111.5M	$-111.5M	$-165.4M	$-245.6M	$-364.6M	$-541.3M	$-803.5M

Section 5 · Relative Valuation Multiples & Regression

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Click any peer node or ticker to open its dedicated equity research report

Rule of 40 vs. EV / Revenue Multiple Regression

OLS Fit: EV/Rev = -36.1 + 0.92 × (Rule of 40) · R² = 83%

Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.

LSPD Actual vs. Reg. Multiple1.0× vs 3.8× fair

Reg.-Implied Share Price$34.27 (73.3% Discount)

LSPDLightspeed Commerce Inc.·Rule of 40: 43.3%·Actual EV/Rev: 1.0×·Regression Fair Multiple: 3.8×

73.3% Below Trendline (Attractive)Open LSPD Report

Company	Ticker	Market Cap	TTM Revenue	Gross Margin	FCF Margin	Rule of 40	SBC % Rev	EV / Rev
Lightspeed Commerce Inc.	LSPD	$1.64B	$1.08B	41.8%	-5.2%	43.3%	5.2%	1.0×
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×

Section 6 · Downside Protection & Multiple Sensitivity

EV / Revenue Multiple Compression Stress Test

Multiple Scenario	EV / Revenue	Implied Enterprise Value	Implied Equity Value	Implied Share Price	Delta vs Current
Current Multiple	1.0×	$1.10B	$1.64B	$12.06	0.0%
-20% Multiple Compression	0.8×	$878.8M	$1.42B	$10.44	-20.0%
-35% Multiple Compression	0.7×	$714.0M	$1.26B	$9.23	-35.0%
Software Baseline Floor (5.0× EV/Rev)	5.0×	$5.38B	$5.93B	$43.58	+390.1%

Section 7 · Investor Diligence FAQ

Frequently Asked Questions: Lightspeed Commerce Inc. (LSPD) Valuation

What is Lightspeed Commerce Inc. (LSPD)'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, Lightspeed Commerce Inc. (LSPD) has a Base Case implied value of -$26.68 per share (with a Bear Case of -$4.41 and a Bull Case of -$67.83), compared to its current price of $12.06. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.

What is Lightspeed Commerce Inc. (LSPD)'s Rule of 40 score and Free Cash Flow margin?

Lightspeed Commerce Inc. achieves a Rule of 40 score of 43.3%, combining a 48.5% revenue growth run-rate with a -5.2% TTM free cash flow margin on $1.08B 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 LSPD stock according to Reverse-DCF analysis?

At $12.06 per share (Enterprise Value of $1.10B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of -13.1%, compared to Lightspeed Commerce Inc.'s historical CAGR of 48.5%. Overall market expectations are rated as "Substantial Margin of Safety".

How does Lightspeed Commerce Inc. compare to Software & Cloud Services software peers?

Lightspeed Commerce Inc. (LSPD) earns an institutional Software Quality Score of 46/100 (Grade C — Capital Intensive / Low Margin). 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 Lightspeed Commerce Inc. (LSPD)'s valuation?

Lightspeed Commerce Inc. recorded $55.6M in TTM stock-based compensation (5.2% of revenue). When treating SBC as a cash-equivalent compensation expense, Lightspeed Commerce Inc.'s SBC-adjusted free cash flow yield is -6.8%, scoring 21/25 on our Shareholder Dilution Friction pillar.

Lightspeed Commerce Inc. (LSPD) DCF Valuation & Fundamental Primer

WACC \ Terminal

1.5%

2.0%

2.5%

3.0%

3.5%

8.5%

$70.31

+483%

$74.84

+521%

$80.13

+564%

$86.38

+616%

$93.89

+678%

9.3%

$63.01

+422%

$66.58

+452%

$70.68

+486%

$75.44

+526%

$81.03

+572%

10.0%

$57.02

+373%

$59.90

+397%

$63.15

+424%

$66.87

+454%

$71.16

+490%

10.8%

$52.03

+331%

$54.38

+351%

$57.01

+373%

$59.98

+397%

$63.37

+425%

11.5%

$47.80

+296%

$49.75

+313%

$51.91

+330%

$54.33

+351%

$57.05

+373%

Statement Line Item

TTM Audited Base

TTM

Revenue

$1.08B

$1.60B

$2.37B

$3.52B

$5.23B

$7.76B

Gross Profit

$450.2M

$668.4M

$992.2M

$1.47B

$2.19B

$3.25B

Operating Income (EBIT)

$-696.0M

$-696.1M

$-1.03B

$-1.53B

$-2.28B

$-3.38B

$-5.02B

Stock-Based Compensation (SBC)

$55.6M

$82.5M

$122.4M

$181.8M

$269.8M

$400.6M

Unlevered Free Cash Flow (FCF)

$-55.9M

$-83.0M

$-123.2M

$-182.8M

$-271.4M

$-402.9M

SBC-Adjusted True Cash Flow

$-111.5M

$-165.4M

$-245.6M

$-364.6M

$-541.3M

$-803.5M

Company

Ticker

Market Cap

TTM Revenue

Gross Margin

FCF Margin

Rule of 40

SBC % Rev

EV / Rev

Lightspeed Commerce Inc.

LSPD

$1.64B

$1.08B

41.8%

-5.2%

43.3%

5.2%

1.0×

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×

Multiple Scenario

EV / Revenue

Implied Enterprise Value

Implied Equity Value

Implied Share Price

Delta vs Current

Current Multiple

1.0×

$1.10B

$1.64B

$12.06

0.0%

-20% Multiple Compression

0.8×

$878.8M

$1.42B

$10.44

-20.0%

-35% Multiple Compression

0.7×

$714.0M

$1.26B

$9.23

-35.0%

Software Baseline Floor (5.0× EV/Rev)

5.0×

$5.38B

$5.93B

$43.58

+390.1%

Lightspeed Commerce Inc. (LSPD) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (46/100 · Grade C)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Reverse-DCF Solver: What Growth is Priced Into LSPD?

Lightspeed Commerce Inc. (LSPD) 5-Year Fundamental Forecast

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Rule of 40 vs. EV / Revenue Multiple Regression

EV / Revenue Multiple Compression Stress Test

Frequently Asked Questions: Lightspeed Commerce Inc. (LSPD) Valuation

What is Lightspeed Commerce Inc. (LSPD)'s intrinsic DCF valuation and implied share price?

What is Lightspeed Commerce Inc. (LSPD)'s Rule of 40 score and Free Cash Flow margin?

What revenue growth rate is priced into LSPD stock according to Reverse-DCF analysis?

How does Lightspeed Commerce Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Lightspeed Commerce Inc. (LSPD)'s valuation?

Related Software & Cloud Services Equity Research Reports

Lightspeed Commerce Inc. (LSPD) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (46/100 · Grade C)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

Reverse-DCF Solver: What Growth is Priced Into LSPD?

Lightspeed Commerce Inc. (LSPD) 5-Year Fundamental Forecast

Software & Cloud Services Peer Comparables & Rule of 40 Regression

Rule of 40 vs. EV / Revenue Multiple Regression

EV / Revenue Multiple Compression Stress Test

Frequently Asked Questions: Lightspeed Commerce Inc. (LSPD) Valuation

What is Lightspeed Commerce Inc. (LSPD)'s intrinsic DCF valuation and implied share price?

What is Lightspeed Commerce Inc. (LSPD)'s Rule of 40 score and Free Cash Flow margin?

What revenue growth rate is priced into LSPD stock according to Reverse-DCF analysis?

How does Lightspeed Commerce Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Lightspeed Commerce Inc. (LSPD)'s valuation?

Related Software & Cloud Services Equity Research Reports