Research HubSoftware & Cloud ServicesTenable Holdings, Inc. (TENB)

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

Tenable Holdings, Inc. (TENB) DCF Valuation & Fundamental Primer

Tenable Holdings, Inc. (TENB) currently trades at $23.05 with an enterprise value of $5.80B. Our proprietary institutional model rates Tenable Holdings, Inc. at 65/100 (Grade: B+ · Quality Software Operator). The current market price prices in an implied 5-year revenue CAGR of 2.1% vs. historical growth of 19.6% (Substantial Margin of Safety).

GDA Quality Score

B+65/100

Quality Software Operator

Share Price / DCF Base

$23.05 / $47.45

Enterprise Value

$2.87B

TTM Revenue

$900.0M (+19.6%)

Gross Margin

77.8%

Rule of 40 Score

43.3%

EV / TTM Revenue

3.2×

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 Tenable Holdings, Inc..

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

Seed TENB in Interactive 3-Statement Model

Section 1 · Intrinsic Valuation Engine

Tenable Holdings, Inc. (TENB) 3-Scenario DCF Valuation Range

WACC: 10.0% · Terminal Growth: 2.5% · Diluted Shares: 120.3M

bear Case DCFSensitivity

$20.23

Implied Equity Value:$2.43B

vs Current ($23.05):-12.2%

base Case DCFPrimary Benchmark

$47.45

Implied Equity Value:$5.71B

vs Current ($23.05):+105.9%

bull Case DCFSensitivity

$85.03

Implied Equity Value:$10.23B

vs Current ($23.05):+268.9%

Interactive What-If DCF SandboxSim Rule of 40: 43.3%

Stress-test TENB'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 CAGR19.6%

2%Hist: 19.6%50%

Target FCF Margin23.7%

5%Base: 23.7%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$47.51

Spread vs Market+106.1%

Simulated EV$5.81B

Effective FCF Margin23.7%

Simulated 5-Year Cash Flow Trajectory (Unlevered FCF vs. Discounted PV)Cumulative 5Y PV: $1.38B

Year 1$1.08B

FCF:$255.1M

PV:$231.9M

Year 2$1.29B

FCF:$305.1M

PV:$252.2M

Year 3$1.54B

FCF:$364.9M

PV:$274.2M

Year 4$1.84B

FCF:$436.4M

PV:$298.1M

Year 5$2.20B

FCF:$522.0M

PV:$324.1M

Enterprise Value Composition Bridge$5.81B

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

5Y Explicit PV: $1.38B (23.8%)Terminal PV: $4.43B (76.2%)

(+) Balance Sheet Cash & Equivalents+$328.6M

(−) Total Debt Obligations−$422.3M

(=) Implied Equity Value (120.3M shs)$5.72B

2D Institutional Valuation Sensitivity Heatmap

Implied share price & upside/downside spread across 25 valuation states (Current Price: $23.05).

WACC \ Terminal	1.5%	2.0%	2.5%	3.0%	3.5%
8.5%	$53.04 +130%	$56.48 +145%	$60.49 +162%	$65.24 +183%	$70.93 +208%
9.3%	$47.45 +106%	$50.16 +118%	$53.27 +131%	$56.88 +147%	$61.12 +165%
10.0%	$42.86 +86%	$45.04 +95%	$47.51 +106%	$50.33 +118%	$53.59 +132%
10.8%	$39.02 +69%	$40.80 +77%	$42.80 +86%	$45.06 +95%	$47.62 +107%
11.5%	$35.77 +55%	$37.24 +62%	$38.88 +69%	$40.72 +77%	$42.78 +86%

Section 2 · Fundamental Underwriting

Institutional Software Quality Scorecard (65/100 · Grade B+)

Quality Software Operator

Solid software model with clear operating leverage, partially offset by standard SBC or moderate burn.

Cash Conversion13 / 25

Actual: 23.7% marginTarget: Target: ≥100%

Positive FCF but lower conversion efficiency due to capex or timing

Dilution Friction10 / 25

Actual: 18.2% of RevTarget: Target: ≤8%

Elevated equity dilution; SBC consumes substantial operating cash flow

Unit Economics25 / 25

Actual: 78% GM / R40: 43%Target: Target: ≥75% GM / ≥40% R40

Elite Tier-1 SaaS compounder with high gross margin and superior Rule of 40

Balance Sheet17 / 25

Actual: -$93.7M Net DebtTarget: Target: Net Cash > 0

Manageable debt load covered by recurring positive free cash flow

Core Investment Strengths & Moats

Top-quartile software unit economics: 77.8% gross margin and 43.3% Rule of 40 score

Key Operational & Dilution Risks

Substantial SBC dilution drag: SBC is 18.2% of revenue ($163.5M)

Section 3 · Expectations Investing

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

Substantial Margin of Safety

The current share price only requires 2.1% 5-year CAGR (16.5% dilution-adjusted), well below historical growth of 19.6%. If the company maintains baseline execution, there is asymmetric upside.

Implied 5-Year Revenue CAGR

2.1%

Required to justify $2.87B EV

Historical Run-Rate CAGR

19.6%

Audited multi-year top-line trajectory

Growth Hurdle Spread

-17.5%

Implied hurdle minus historical growth

Implied FCF Margin @ Hist. Growth

11.7%

Steady-state FCF margin needed at current CAGR

Institutional Dilution-Adjusted Hurdle Lens

Headline Reverse-DCF ignores Stock-Based Compensation (18.2% of revenue) and annual share dilution (2.2%/yr). Accounting for both requires 16.5% 5-year revenue CAGR to justify $23.05/sh on a true per-share economic cash flow basis.

True Economic Hurdle16.5%

SBC & Dilution Hurdle Tax+14.4% / yr

Section 4 · 5-Year Forecast Schedule

Tenable Holdings, Inc. (TENB) 5-Year Fundamental Forecast

Customize in Live Engine

Statement Line Item	TTM Audited Base	TTM	Y1	Y2	Y3	Y4	Y5
Revenue	$900.0M	$900.0M	$1.08B	$1.29B	$1.54B	$1.84B	$2.20B
Gross Profit	$700.4M	$700.4M	$837.5M	$1.00B	$1.20B	$1.43B	$1.71B
Operating Income (EBIT)	$-6.9M	$-6.8M	$-8.2M	$-9.8M	$-11.7M	$-14.0M	$-16.7M
Stock-Based Compensation (SBC)	$163.5M	$163.5M	$195.6M	$233.8M	$279.6M	$334.4M	$399.9M
Unlevered Free Cash Flow (FCF)	$213.2M	$213.2M	$255.0M	$304.9M	$364.6M	$436.0M	$521.3M
SBC-Adjusted True Cash Flow	$49.7M	$49.7M	$59.4M	$71.0M	$85.0M	$101.6M	$121.5M

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 = -33.0 + 0.87 × (Rule of 40) · R² = 84%

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

TENB Actual vs. Reg. Multiple3.2× vs 4.5× fair

Reg.-Implied Share Price$33.05 (29.5% Discount)

TENBTenable Holdings, Inc.·Rule of 40: 43.3%·Actual EV/Rev: 3.2×·Regression Fair Multiple: 4.5×

29.5% Below Trendline (Attractive)Open TENB Report

Company	Ticker	Market Cap	TTM Revenue	Gross Margin	FCF Margin	Rule of 40	SBC % Rev	EV / Rev
Tenable Holdings, Inc.	TENB	$2.77B	$900.0M	77.8%	23.7%	43.3%	18.2%	3.2×
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×

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	3.2×	$2.87B	$2.77B	$23.05	0.0%
-20% Multiple Compression	2.5×	$2.29B	$2.20B	$18.28	-20.0%
-35% Multiple Compression	2.1×	$1.86B	$1.77B	$14.71	-35.0%
Software Baseline Floor (5.0× EV/Rev)	5.0×	$4.50B	$4.41B	$36.62	+57.0%

Section 7 · Investor Diligence FAQ

Frequently Asked Questions: Tenable Holdings, Inc. (TENB) Valuation

What is Tenable Holdings, Inc. (TENB)'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, Tenable Holdings, Inc. (TENB) has a Base Case implied value of $47.45 per share (with a Bear Case of $20.23 and a Bull Case of $85.03), compared to its current price of $23.05. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.

What is Tenable Holdings, Inc. (TENB)'s Rule of 40 score and Free Cash Flow margin?

Tenable Holdings, Inc. achieves a Rule of 40 score of 43.3%, combining a 19.6% revenue growth run-rate with a 23.7% TTM free cash flow margin on $900.0M 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 TENB stock according to Reverse-DCF analysis?

At $23.05 per share (Enterprise Value of $2.87B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 2.1%, compared to Tenable Holdings, Inc.'s historical CAGR of 19.6%. Overall market expectations are rated as "Substantial Margin of Safety".

How does Tenable Holdings, Inc. compare to Software & Cloud Services software peers?

Tenable Holdings, Inc. (TENB) earns an institutional Software Quality Score of 65/100 (Grade B+ — Quality Software Operator). 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 Tenable Holdings, Inc. (TENB)'s valuation?

Tenable Holdings, Inc. recorded $163.5M in TTM stock-based compensation (18.2% of revenue). When treating SBC as a cash-equivalent compensation expense, Tenable Holdings, Inc.'s SBC-adjusted free cash flow yield is 1.8%, scoring 10/25 on our Shareholder Dilution Friction pillar.

Tenable Holdings, Inc. (TENB) DCF Valuation & Fundamental Primer

WACC \ Terminal

1.5%

2.0%

2.5%

3.0%

3.5%

8.5%

$53.04

+130%

$56.48

+145%

$60.49

+162%

$65.24

+183%

$70.93

+208%

9.3%

$47.45

+106%

$50.16

+118%

$53.27

+131%

$56.88

+147%

$61.12

+165%

10.0%

$42.86

+86%

$45.04

+95%

$47.51

+106%

$50.33

+118%

$53.59

+132%

10.8%

$39.02

+69%

$40.80

+77%

$42.80

+86%

$45.06

+95%

$47.62

+107%

11.5%

$35.77

+55%

$37.24

+62%

$38.88

+69%

$40.72

+77%

$42.78

+86%

Statement Line Item

TTM Audited Base

TTM

Revenue

$900.0M

$1.08B

$1.29B

$1.54B

$1.84B

$2.20B

Gross Profit

$700.4M

$837.5M

$1.00B

$1.20B

$1.43B

$1.71B

Operating Income (EBIT)

$-6.9M

$-6.8M

$-8.2M

$-9.8M

$-11.7M

$-14.0M

$-16.7M

Stock-Based Compensation (SBC)

$163.5M

$195.6M

$233.8M

$279.6M

$334.4M

$399.9M

Unlevered Free Cash Flow (FCF)

$213.2M

$255.0M

$304.9M

$364.6M

$436.0M

$521.3M

SBC-Adjusted True Cash Flow

$49.7M

$59.4M

$71.0M

$85.0M

$101.6M

$121.5M

Company

Ticker

Market Cap

TTM Revenue

Gross Margin

FCF Margin

Rule of 40

SBC % Rev

EV / Rev

Tenable Holdings, Inc.

TENB

$2.77B

$900.0M

77.8%

23.7%

43.3%

18.2%

3.2×

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×

Multiple Scenario

EV / Revenue

Implied Enterprise Value

Implied Equity Value

Implied Share Price

Delta vs Current

Current Multiple

3.2×

$2.87B

$2.77B

$23.05

0.0%

-20% Multiple Compression

2.5×

$2.29B

$2.20B

$18.28

-20.0%

-35% Multiple Compression

2.1×

$1.86B

$1.77B

$14.71

-35.0%

Software Baseline Floor (5.0× EV/Rev)

5.0×

$4.50B

$4.41B

$36.62

+57.0%

Tenable Holdings, Inc. (TENB) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (65/100 · Grade B+)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

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

Tenable Holdings, Inc. (TENB) 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: Tenable Holdings, Inc. (TENB) Valuation

What is Tenable Holdings, Inc. (TENB)'s intrinsic DCF valuation and implied share price?

What is Tenable Holdings, Inc. (TENB)'s Rule of 40 score and Free Cash Flow margin?

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

How does Tenable Holdings, Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Tenable Holdings, Inc. (TENB)'s valuation?

Related Software & Cloud Services Equity Research Reports

Tenable Holdings, Inc. (TENB) 3-Scenario DCF Valuation Range

2D Institutional Valuation Sensitivity Heatmap

Institutional Software Quality Scorecard (65/100 · Grade B+)

Core Investment Strengths & Moats

Key Operational & Dilution Risks

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

Tenable Holdings, Inc. (TENB) 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: Tenable Holdings, Inc. (TENB) Valuation

What is Tenable Holdings, Inc. (TENB)'s intrinsic DCF valuation and implied share price?

What is Tenable Holdings, Inc. (TENB)'s Rule of 40 score and Free Cash Flow margin?

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

How does Tenable Holdings, Inc. compare to Software & Cloud Services software peers?

How does Stock-Based Compensation (SBC) impact Tenable Holdings, Inc. (TENB)'s valuation?

Related Software & Cloud Services Equity Research Reports