Why JFrog could leapfrog the competition in 2024

JFrog Ltd. NASDAQ: FROG provides DevOps platform solutions that enable IT teams and enterprise developers to manage and automate the software delivery process. JFrog considers itself a liquid software company through its JFrog software supply chain platform.

DevOps platforms improve and simplify software development and delivery. JFrog promotes better collaboration between all parties connected to the software lifecycle by breaking down silos. This leads to greater efficiency and speed increased by automation, scalability, improved observability, resource utilization and feedback loops. This results in improved ROI, better business results, customer satisfaction and reliability.

This information and technology company counts most of the Fortune 100 companies as customers, including Nvidia Co. NASDAQ:NVDA, Buoysing Co. NYSE:BAAND Splunk Inc. NASDAQ:SPLK. Compete with Gitlab Inc. NASDAQ: GTLB AND Microsoft Co. NASDAQ:MSFT, which owns GitHub. Its platform helps companies leverage artificial intelligence (AI) and manage machine learning (ML) models with its tools, enabling smoother deliveries and workflows.

Binaries, artifacts and repositories

What initially appear to be physical industrial components are instead critical to the software development ecosystem. Software binaries are compiled executable files derived from source code in machine-readable form. These are instructions given to the computer to run specific applications and programs on a target platform or operating system.

Binary files, as well as various files and components, including documentation, configuration files, libraries, and other resources, are artifacts. These represent the output of the different phases of the software development cycle, ranging from compilation to testing up to packagingaging and distribution.

Repositories are centralized storage systems that host software artifacts. They serve as a central hub for distribution between environments and development teams.

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Crushing him in the fourth quarter

On February 14, 2024, JFrog reported EPS of 19 cents for the fourth quarter of 2023, beating consensus estimates by 7 cents. Non-GAAP gross profit was $82.3 million with a non-GAAP gross margin of 84.6%. Non-GAAP operating income was $16.2 million. Non-GAAP operating margin was 16.6%.

Revenue jumped 27.1% year over year to $97.26 million, beating consensus analyst estimates of $93.07 million. Cloud revenue increased 59% year over year. JFrog grew its $1 million or more customers by 96% year-over-year to 37. Remaining performance obligations (RPOs) totaled $259.5 million.

We are closing an exceptional year

For the full year 2023, JFrog has 50% YoY revenue growth fueled by 50% Cloud revenue and 50% YoY Enterprise+ subscription revenue. The company grew its unique customers to 7,400 in 2023, up from 7,200 the previous year. It ended the year with $545 million in cash and cash equivalents. Cloud revenue represents 37% of total revenue. The net dollar retention rate for the last four quarters was 119%. Obtain AI-powered insights on MarketBeat.

Raise the bar

JFrog raised its forecast for both the first quarter of 2024 and full-year 2024. The company expects first-quarter 2024 EPS of 13 cents to 15 cents versus consensus estimates of 11 cents. Revenue for the first quarter of 2024 is expected to be in the range of $98 million to $99 million, compared to analyst estimates of $97.33 million.

JFrog forecast full-year 2024 EPS of 58 cents to 60 cents versus consensus analyst estimates of 52 cents. Full-year 2024 revenues are expected to be between $424 million and $428 million versus $421.82 million.

Comments from the CEO

JFrog CEO Shlomi Ben Haim commented: “Our 2023 performance demonstrates JFrog’s strong execution across our strategic pillars, driving growth in the cloud, leveraging comprehensive software supply chain capabilities, and enhancing our security offers…”

Haim added: “The market demands a consolidated solution for DevOps and DevSecOps around binary management, and we are excited to see new expansion opportunities in security in 2024, as well as potential benefits within MLOps and MLSecOps, which are natively supported by the organization.r platform.”

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Daily ascendant triangle breakup pattern

The daily candlestick chart on FROG illustrates an ascending breakout triangle pattern. The uptrend started at the low of $31.13 on January 4, 2024: flat upper trendline resistance formed at $35.35. While FROG looked to potentially collapse through the ascending treendline on January 29, 2024, shares were able to stage a rally through the flat-top trendline to peak at $40.40 on February 12, 2024, before falling back into the triangle. The Q4 2023 earnings release, with its raised guidance, sent FROG to $44.25 on February 15, 2024. relative strength index (RSI) crossed the 70 band before testing it again. THE 50 period daily moving average Support (MA) is rising at $33.92. The pullback support levels are at $42.33, $40.40, $37.13, and $34.44.

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