Core Viewpoint - The article discusses the investment insights and research capabilities of Ian Bezek, highlighting his experience in Latin American markets and focus on high-quality growth stocks at reasonable prices [2]. Group 1: Analyst Background - Ian Bezek has a decade of experience as a hedge fund analyst, particularly at Kerrisdale Capital [2]. - He specializes in conducting on-the-ground research in Latin America, focusing on markets such as Mexico, Colombia, and Chile [2]. - Bezek leads an investing group called Ian's Insider Corner, which offers various features including market analysis and trade alerts [2]. Group 2: Group Features - Ian's Insider Corner provides a Weekend Digest that covers new investment ideas, updates on current holdings, and macroeconomic analysis [2]. - The group includes an active chat room for members to engage and discuss investment strategies [2]. - Members receive direct access to Ian for personalized insights and responses to their questions [2].

Core Insights - Selling pressure is increasing on software stocks as the market moves deeper into 2026, contrasting with previous years where upward multiples re-ratings significantly drove stock gains [1] Group 1: Market Trends - Investors are experiencing a shift in market dynamics, moving away from the reliance on upward multiples re-ratings that previously characterized stock performance [1] Group 2: Analyst Background - Gary Alexander has extensive experience in covering technology companies on Wall Street and has worked in Silicon Valley, providing him with insights into current industry themes [1] - He has been a contributor to Seeking Alpha since 2017 and has been featured in various web publications, indicating a strong presence in the investment community [1]

Core Viewpoint - GitLab Inc. (NASDAQ:GTLB) is currently viewed as a tech stock to sell, with significant reductions in holdings by ARK Investment Management, indicating potential concerns about its future performance [1]. Group 1: Company Developments - On March 19, GitLab announced plans to enhance accessibility and affordability of agentic capabilities throughout the software development cycle [2]. - The release of GitLab 18.10 allows customers to utilize agentic capabilities at a lower cost, enabling organizations on the free tier to access the GitLab Duo Agent platform through a monthly GitLab Credits commitment [3]. - GitLab's all-in-one DevSecOps platform integrates various development processes, allowing teams to plan, build, secure, and deploy software more efficiently compared to traditional methods [5]. Group 2: Market Sentiment and Ratings - Bernstein SocGen Group reiterated an Outperform rating for GitLab, maintaining a price target of $60, citing strong adoption of the GitLab Duo product and the company's solid strategic positioning in the market [4].

Group 1: UiPath - UiPath is currently trading at a forward price-to-sales (P/S) ratio of 3.6 times, indicating a low valuation despite its potential [2] - The company is transitioning from robotic process automation (RPA) to an agentic AI orchestration platform, which could lead to significant growth as the demand for managing AI agents increases [3] - If revenue growth accelerates, there is potential for the stock to double given its current low valuation [3] Group 2: GitLab - GitLab's stock is trading at a forward P/S multiple of 3.4 times, which is considered extremely cheap for a profitable company with revenue growth in the high teens to 20% [4] - The company is implementing a new hybrid pricing model that could enhance its growth prospects, potentially leading to a doubling of the stock price [5] - GitLab's solutions are expected to gain importance with the rise of AI-driven software development, and there is a possibility of acquisition by larger firms at a premium [6] Group 3: SentinelOne - SentinelOne is trading at a forward P/S ratio of 4, which is lower than that of larger endpoint security peers, despite showing similar growth [7] - The company is experiencing solid cross-platform adoption, and its Purple AI solution is gaining momentum, which could contribute to revenue growth [8] - Recent acquisitions, including Prompt Security and Observo AI, are expected to enhance SentinelOne's offerings beyond endpoint security, creating a more comprehensive security and data management platform [8]

Core View - GitLab Inc. (NASDAQ:GTLB) is recognized as one of the 10 Best New AI Stocks to Buy, despite recent price target reductions by analysts reflecting a cautious outlook on the company's near-term growth potential [1][3]. Analyst Ratings and Price Targets - Morgan Stanley analyst Sanjit Singh lowered the price target for GitLab to $29 from $38 while maintaining an Equal Weight rating, indicating a more cautious outlook due to increased investment levels and moderated expectations [1]. - Truist Financial also reduced its price target to $25 from $35 while keeping a Hold rating, citing demand-related headwinds and modeling challenges affecting its fiscal 2027 outlook [3]. - RBC Capital Markets reiterated an Outperform rating but lowered its target to $33 from $40, highlighting strong enterprise growth and the lowest customer churn in four years, despite softness in the SMB segment [3]. Company Overview - GitLab provides an AI-powered DevSecOps platform that allows organizations to manage the entire software development lifecycle in a unified environment, enhancing efficiency and accelerating digital transformation [4]. - The integration of artificial intelligence into development, security, and operations workflows positions GitLab favorably for long-term growth as demand for AI-enabled software development tools continues to rise [4]. - GitLab went public in 2021, marking its entry into the market as a significant player in the AI and software development sectors [4].

Core Insights - GitLab has launched GitLab 18.10, enhancing access to agentic AI capabilities across the software development lifecycle, making it more affordable and easier for organizations to adopt [1][2] Product Features - The GitLab Duo Agent Platform is now available to organizations on the GitLab.com free tier through a monthly commitment of GitLab Credits, allowing immediate access without per-seat costs [2][5] - Agentic Code Reviews are now priced at a flat cost of $0.25 per review, enabling organizations to automate code reviews at scale, which can lead to significant savings compared to manual reviews [3][5] - GitLab Duo Agent Platform includes SAST false positive detection, which helps prioritize serious vulnerabilities and streamline remediation efforts by scoring findings based on false positive likelihood [4][5] Market Position - GitLab serves over 50 million registered users, including 50% of the Fortune 100, indicating strong trust in its platform for delivering secure software efficiently [7][8] - The company aims to accelerate access to advanced agentic AI for software teams of all sizes, enhancing innovation velocity while maintaining security and budget control [6][11]

Financial Performance - Total revenue for the fiscal year ended January 31, 2026, was $955.2 million, representing a growth rate of 26% compared to $759.2 million in the previous year[95]. - The total number of Base Customers increased to 10,682 as of January 31, 2026, up from 9,893 as of January 31, 2025[93]. - The company incurred net losses of approximately $56.0 million, $6.3 million, and $425.7 million in fiscal years 2026, 2025, and 2024, respectively, with an accumulated deficit of approximately $1.2 billion as of January 31, 2026[100]. - As of January 31, 2026, the company had $1,259.9 million in cash, cash equivalents, and short-term investments, up from $992.4 million as of January 31, 2025, indicating a growth of approximately 27%[384]. - The company's cash equivalents and short-term investments primarily consist of money market funds, treasuries, agency securities, corporate debt securities, and commercial paper, totaling $1,183.1 million as of January 31, 2026, compared to $898.3 million in the previous year[384]. Growth and Investment Strategies - The company plans to continue investing in product development, including enhancements related to artificial intelligence, and expanding its sales and marketing efforts[101]. - The company anticipates that its operating expenses will increase as it invests in growth opportunities and infrastructure[100]. - The company plans to expand its marketing and sales capabilities to attract larger organizations, but success is not guaranteed and may divert resources from existing customer maintenance[163]. - The company aims to convert users of free products into paying customers, but this may require sophisticated sales efforts and could be impacted by general economic conditions[162]. - The company may need to change its subscription-based revenue model to remain competitive, which could impact financial stability[136]. Market and Competitive Risks - Future revenue growth may be impacted by factors such as increased competition, changes in technology, and global economic conditions[97]. - Intense competition in the software market could lead to a loss of market share, adversely affecting the company's business and financial condition[115]. - The company competes with well-established providers like Microsoft and Atlassian, which have greater resources and larger customer bases[117]. - The introduction of new services by competitors could make the company's solutions obsolete, impacting its business and financial condition[123]. - The market for the company's services is rapidly evolving, making it difficult to predict customer adoption and demand, which could adversely affect future results[133]. Operational and Compliance Challenges - Significant legal, accounting, and operational expenses are expected as the company continues to operate as a public entity[102]. - The company faces heightened security risks due to the nature of its platform, which allows code execution, increasing the potential attack surface[108]. - Security breaches could lead to litigation, reputational harm, and significant financial liabilities for the company[112]. - The company is subject to evolving privacy laws, including GDPR and CCPA, which impose significant compliance obligations and potential penalties[201][202]. - Compliance with privacy legislation may require additional resources and incur costs, affecting financial condition and operational results[201]. Customer and Revenue Dynamics - The company relies on sales and marketing strategies to drive revenue growth, and any decline in customer renewals could harm future operating results[134]. - Customer renewal rates may fluctuate due to dissatisfaction with pricing or services, which could adversely affect revenue if customers opt for free versions or discontinue use[147]. - A significant portion of annual orders typically comes from new and existing customer renewals in the last two fiscal quarters, influenced by the annual budget approval process[142]. - The company faces potential fluctuations in customer expansions and renewals, which may decline due to factors such as customer satisfaction, pricing, and macroeconomic conditions[139]. - The length of the sales cycle can be unpredictable, particularly for large customers, affecting revenue timing and operational adjustments[222]. Financial and Tax Considerations - The company may need to raise additional capital to support growth and respond to business challenges, which could adversely affect operating results if capital is not raised on acceptable terms[253]. - The company faces potential increases in effective tax rates due to changes in tax laws, including the One Big Beautiful Bill Act, which implements significant corporate tax reforms[257]. - The company is exposed to greater than anticipated tax liabilities due to aggressive interpretations of tax laws by jurisdictions in which it operates[261]. - The company may experience volatility in the market price of its Class A common stock, influenced by factors such as operating results and industry developments[266]. - The company may face dilution of existing stockholders' equity if additional funds are raised through equity or convertible debt issuances[255]. Strategic Risks and Future Outlook - The ability to forecast future results is subject to uncertainties, including the effectiveness of growth management and billing models[99]. - The company faces challenges in transitioning users from free to paid versions of its services, affecting revenue growth[118]. - The company must continuously enhance its services to integrate with various technologies, which requires significant resources and could impact revenue growth if not managed effectively[168]. - The company may engage in merger and acquisition activities, which could disrupt business and dilute stockholder value[185]. - Risks associated with acquisitions include management distraction, integration challenges, and potential negative perceptions from users or investors[186]. Regulatory and Compliance Risks - The company is subject to the reporting requirements of the Exchange Act and the Sarbanes-Oxley Act, as well as Nasdaq listing standards[247]. - The company incurs significant costs related to compliance with the Sarbanes-Oxley Act, including accounting and management oversight expenses[248]. - The company has faced regulatory scrutiny regarding export controls, particularly concerning software exports to countries like Russia and Belarus, which may require licenses[208]. - Any failure to comply with anti-bribery and anti-corruption laws could result in significant penalties and adversely affect the company's reputation and operations[212]. - The company is transitioning certain users in China to its JiHu entity to comply with the Personal Information Protection Law[202]. Human Resources and Culture - The company faces intense competition for highly skilled personnel, particularly in AI and machine learning, which may hinder its ability to hire and retain qualified team members[225]. - The company’s corporate culture is a key contributor to its success, and failure to maintain this culture as it grows could harm innovation and teamwork[228]. - Customization demands from customers may increase upfront investment without guaranteed subscription growth, affecting overall business performance[166]. - The reliance on channel partners for sales and support poses risks, as poor performance from these partners could harm the company's brand and growth[170]. - The company tracks performance metrics using internal tools, which may be subject to inaccuracies, potentially harming reputation and business[173].

Core Viewpoint - Madison Small Cap Fund's fourth-quarter 2025 performance was challenging, underperforming the Russell 2000 Index, with a return of -0.4% compared to the benchmark's 2.2% [1] Fund Performance - The fund's sector allocation negatively impacted its performance, particularly in the healthcare sector, which was the weakest [1] - The fund remains optimistic about the speculative market losing momentum but is cautious about market irrationality [1] GitLab Inc. Overview - GitLab Inc. (NASDAQ:GTLB) is a software development lifecycle platform that covers DevSecOps stages, with a market capitalization of $3.881 billion [2] - As of March 12, 2026, GitLab's stock closed at $22.82 per share, with a one-month return of -22.77% and a 52-week loss of 56.18% [2] Investment Position in GitLab - Madison Small Cap Fund initiated a new investment position in GitLab, highlighting its strategic software tools that assist developers throughout the software development pipeline [3] - GitLab has mid-teens operating margins, a strong balance sheet, and is experiencing double-digit growth in a large market [3] - The company operates in a duopoly with Microsoft's GitHub platform, and the fund has confidence in the recently appointed CEO, Bill Staples [3] - The stock has faced pressure due to concerns about AI-powered competitors, but the fund believes that increased software development will enhance the demand for GitLab's tools [3] - The estimated intrinsic value of GitLab's stock is $75 per share, indicating an attractive investment opportunity at current prices [3]

Core Viewpoint - GitLab's stock experienced a significant decline of 24.8% in February, influenced by broader market trends and macroeconomic concerns, despite no major company-specific news [1][2][4]. Market Performance - The S&P 500 and Nasdaq Composite also faced declines of 0.9% and 3.4%, respectively, during the same period [1]. - GitLab's stock price fell further by 6.5% in March, despite reporting better-than-expected Q4 results [8]. Financial Results - In Q4, GitLab reported a non-GAAP profit of $0.30 per share on sales of $260.4 million, exceeding analyst expectations of $0.23 per share on sales of $252.22 million [7]. - For the current quarter, GitLab anticipates sales between $253 million and $255 million, slightly below the analyst estimate of $256.69 million [9]. - The full-year sales target is set between $1.099 billion and $1.118 billion, which is below the average analyst estimate of $1.13 billion [10]. Guidance and Market Sentiment - The forward guidance provided by GitLab was weaker than expected, contributing to the stock's decline [8][10]. - Geopolitical tensions, particularly the conflict involving the U.S. and Israel with Iran, along with disappointing U.S. payroll figures, have added to market volatility and investor concerns regarding GitLab's growth outlook [11].

Core Viewpoint - GitLab's stock has faced significant declines, down approximately 60% over the past year, following conservative guidance issued after its fourth-quarter earnings report, raising questions about whether it is a good time to invest or divest [1][2]. Financial Performance - For fiscal Q4, GitLab reported a revenue increase of 23% year over year, reaching $260.4 million, surpassing its forecast of $251 million to $252 million [3]. - Subscription revenue grew by 26% year over year to $234.3 million, while license revenue saw a modest increase of 1% to $26.1 million [3]. Customer Metrics - The company achieved a dollar-based net retention rate of 118%, indicating strong growth within its existing customer base [4]. - The number of customers generating $100,000 or more in annual recurring revenue (ARR) increased by 18% to 1,456, and those with $1 million in ARR rose by 26% to 155 [4]. Future Guidance - GitLab's guidance for full-year fiscal 2027 revenue is projected between $1.099 billion and $1.118 billion, reflecting a growth rate of 15% to 17%, which is below the analyst consensus of $1.12 billion [5]. - For fiscal Q1, the company forecasts revenue between $253 million and $255 million, indicating approximately 18% growth at the midpoint, with adjusted EPS expected to be between $0.20 and $0.21 [5]. Strategic Initiatives - Management plans to stimulate growth by increasing the sales headcount and attracting new customers, along with offering more à la carte options to enhance average revenue per user (ARPU) without pressuring price-sensitive customers to upgrade [6].