HubSpot Inc. Common Stock (HUBS)

FairStock Score: 34/100 — RISKY

Key Financials

Strengths

• Generates $652 million in annual free cash flow (5.8% yield on market cap)
• Strong Piotroski F-Score of 7/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• Conservative balance sheet with debt-to-equity of just 0.13, providing financial flexibility
• Altman Z-Score of 4.0 confirms minimal bankruptcy risk and strong solvency
• Revenue growth of 20.4% demonstrates strong top-line momentum

Concerns

• Trades significantly above Graham Number ($28) with negative 668% margin of safety—limited downside protection

AI Analysis

HubSpot Inc. Common Stock is a mid-cap technology company valued at $11.2 billion. The business generates $3.1 billion in annual revenue with a 1.7% net margin and $652 million in free cash flow. From a quality standpoint, HubSpot shows solid Piotroski F-Score of 7/9 and healthy Altman Z-Score of 4.0. On valuation, the stock is commanding a steep 249.6x multiple, with trades far above its Graham Number ($28) with no margin of safety. Growth dynamics show revenue growing at 20.4% and profit growth of 992.2%. Our composite FairStock Score of 34/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

HubSpot's 20% revenue growth trajectory could accelerate as it captures additional market share in the technology sector. With $652 million in annual free cash flow (5.8% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

At 250x earnings, any growth disappointment triggers rapid multiple compression—a 20% earnings miss plus multiple contraction to 20x implies 40%+ downside. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer