Freshworks Inc. Class A Common Stock (FRSH)

FairStock Score: 71/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for businesses that earn high returns on capital and sell at a discount to intrinsic value. Freshworks is a software-as-a-service provider. In fiscal year 2025, the year ended 2025-12-31, revenue was $838.8M and net income was $183.7M, a sharp turn from a net loss of $95.4M in fiscal year 2024, ended 2024-12-31. That turnaround is real, and trailing free cash flow of $220.6M gives a FairStock FCF yield of 5.3% at the 2026-10-26 close, helped by low debt with a D/E of 0.04. But quality is uneven. FairStock's ROCE is only 1.58%, and fiscal Q2 2026, the quarter ended 2026-06-30, had revenue of $237.4M but net income of just $3.2M; fiscal Q1 2026, the quarter ended 2026-03-31, lost $4.8M. At $15.36, FairStock's Graham Number is $6.95, a -122.88% margin of safety, while P/E is 24.38, P/B is 4.50, and EV/EBITDA is 56.54. FairStock's Altman Z-score of 1.42 adds caution, though the Piotroski F-Score of 7/9 is respectable. The computed Lynch category is TURNAROUND — returned to profit after a loss within the last three years. I see improving profit and decent cash generation, but thin recent margins, weak returns on capital, and a price well above Graham value leave no obvious bargain. The numbers suggest a business in transition, not one with a proven, high-return moat.

In plain English: Freshworks sells software that helps companies manage customer service and employee support. The business is growing and made a profit in fiscal 2025 after earlier losses, but recent quarters show only very thin profits or losses. At the 2026-10-26 close of $15.36, the price looks high compared with what the company earns and owns.

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Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer