Regression valuation
Fit an ordinary least squares regression of a valuation multiple against a fundamental driver. Each company's residual quantifies how much it trades above or below where the comp set says it should. Inspired by Meritech's growth-adjusted multiple framework.Snapshot: 2026-08-04.
All sectorsApplication SoftwareInfrastructure & Data SoftwareCybersecurityFintechInternet & Digital CommerceConsumer Internet, Media & GamingHealthcare ServicesMedical Devices & DiagnosticsSemiconductorsPharma & BiotechIndustrial, Aerospace & DefenseFinancial ServicesBusiness ServicesUtilitiesEnergyMaterialsTransportationConsumer DiscretionaryConsumer StaplesReal EstateCommunications & Telecom
Universe: Infrastructure & Data Software · 20 companies
Model
y = 22.77·x + 2.03
n = 20 · R² = 0.318
Most undervalued vs. model
Trading below the regression line
| Ticker | Actual | Model | Residual |
|---|---|---|---|
| TEAMAtlassian Corporation | 3.9x | 11.8x | -67.0% |
| ORCLOracle Corporation | 5.7x | 12.0x | -53.0% |
| ESTCElastic N.V. | 3.2x | 6.4x | -50.0% |
| GTLBGitLab Inc. | 4.0x | 7.9x | -49.4% |
| DOCNDigitalOcean Holdings, Inc. | 10.4x | 17.6x | -41.2% |
Most overvalued vs. model
Trading above the regression line
| Ticker | Actual | Model | Residual |
|---|---|---|---|
| AIC3.ai, Inc. | 4.1x | 0.2x | 1877.7% |
| NETCloudflare, Inc. | 32.5x | 13.7x | 138.0% |
| DDOGDatadog, Inc. | 20.2x | 11.8x | 70.7% |
| FROGJFrog Ltd. | 13.9x | 9.2x | 51.6% |
| MSFTMicrosoft Corporation | 9.4x | 6.5x | 45.0% |