INST Stock Overview
Instructure Holdings, Inc. provides cloud-based learning, assessment, development, and engagement systems worldwide.
Instructure Holdings Competitors
Price History & Performance
|Historical stock prices|
|Current Share Price||US$22.50|
|52 Week High||US$29.59|
|52 Week Low||US$15.68|
|1 Month Change||-0.53%|
|3 Month Change||2.04%|
|1 Year Change||-0.40%|
|3 Year Change||n/a|
|5 Year Change||n/a|
|Change since IPO||7.25%|
Recent News & Updates
Instructure Grows Revenue While Reducing Debt And Losses
Summary Instructure went public in July 2021, raising approximately $250 million in gross proceeds in an IPO. The firm provides a range of learning management system software to organizations worldwide. INST has produced growing revenue and reduced operating losses while paying down debt and the stock has performed admirably compared to many software stocks. My outlook on INST is a Buy at around $22.00 per share. A Quick Take On Instructure Instructure (INST) went public in July 2021, raising approximately $250 million in gross proceeds from an IPO that priced at $20.00 per share. The firm provides learning management system software to various education markets worldwide. INST’s relative performance has been far better than so many other software stocks over the past 12 months and the company appears positioned for further growth and progress toward positive earnings. My outlook on INST is a Buy at $22.00 per share. Instructure Overview Salt Lake City, Utah-based Instructure was founded to develop a learning management system for global learning administration to create learning efficiencies for both K-12 and higher education & continuing education markets. The company originally went public in 2015 and was taken private by Thoma Bravo in 2020. Management is headed by Chief Executive Officer Steve Daly, who has been with the firm since July 2020 and was previously CEO of Landesk/Ivanti, an IT management and security software company. The company’s primary offerings include: Canvas LMS Canvas Studio Canvas Catalog Assessments Portfolium Canvas Network The firm seeks customer relationships with schools and school districts in the U.S. and core international markets. Instructure’s Market & Competition According to a 2020 market research report by Technavio, the U.S. market for e-learning is forecast to grow by over $21 billion from 2020 to 2024. This represents a forecast CAGR of 9.8% from 2020 to 2024. The main drivers for this expected growth are increased consumer demand for more cost-efficient and time-flexible learning programs available on multiple devices rather than having to go to a physical classroom. Also, the high adoption of mobile devices and the reduction in the cost of Internet bandwidth make the entry cost for consumers lower than in previous years. Major competitive or other industry participants include: Blackboard D2L Moodle Schoology Cengage Learning Others Instructure’s Recent Financial Performance Total revenue by quarter has grown according to the following chart: 9 Quarter Total Revenue (Seeking Alpha) Gross profit by quarter has produced a similar trajectory as total revenue: 9 Quarter Gross Profit (Seeking Alpha) Selling, G&A expenses as a percentage of total revenue by quarter have remained relatively stable in recent quarters: 9 Quarter Selling, G&A % Of Revenue (Seeking Alpha) Operating losses by quarter have lessened, as the chart shows below: 9 Quarter Operating Income (Seeking Alpha) Negative earnings per share (Diluted) have also generally improved: 9 Quarter Earnings Per Share (Seeking Alpha) (All data in above charts is GAAP) Since its IPO, INST’s stock price has dropped 0.6% vs. the U.S. S&P 500 index’s fall of around 17.3%, as the chart below indicates: 52 Week Stock Price (Seeking Alpha) Valuation And Other Metrics For Instructure Below is a table of relevant capitalization and valuation figures for the company: Measure [TTM] Amount Enterprise Value / Sales 8.13 Revenue Growth Rate 24.9% Net Income Margin -11.8% GAAP EBITDA % 28.4% Market Capitalization $3,190,000,000 Enterprise Value $3,620,000,000 Operating Cash Flow $99,970,000 Earnings Per Share (Fully Diluted) -$0.38 (Source - Seeking Alpha) The Rule of 40 is a software industry rule of thumb that says that as long as the combined revenue growth rate and EBITDA percentage rate equal or exceed 40%, the firm is on an acceptable growth/EBITDA trajectory. INST’s most recent GAAP Rule of 40 calculation was 53.3% as of Q2 2022, so the firm has performed well in this regard, per the table below: Rule of 40 - GAAP Calculation Recent Rev. Growth % 24.9% GAAP EBITDA % 28.4% Total 53.3% (Source - Seeking Alpha) Commentary On Instructure In its last earnings call (Source - Seeking Alpha), covering Q2 2022’s results, management highlighted exceeding financial guidance since its IPO while continuing strong R&D investment and making three acquisitions with the goal of expanding its addressable market. Also, management has placed significant focus on its international growth strategy through a channel partner approach. Leadership also hinted at creating ‘further shareholder value going forward,’ which to my mind may include a stock buyback program from its expected free cash flow. As to its financial results, revenue rose 22% year-over-year while producing non-GAAP gross margin of 77.6%, a 3.9% increase. Management did not disclose the company’s net dollar retention rate, which provides visibility into its product/market fit and sales & marketing efficiency. However, the firm’s Rule of 40 results have been impressive. Sales and marketing and G&A expenses rose somewhat as a percentage of allocated combined receipts [ACR], while R&D expenses dropped slightly against ACR. Negative earnings increased sequentially.
Instructure Holdings: Offering A Good Structure For A Profitable Investment
I will update my original article of March 2022. I will explain why I'm happy that the stock is up 26% since the original article and why I think it has more to offer in the future. Readers will have the opportunity to see the stellar revenue growth the company has produced over the span of 2018 to Mid-Year 2022. Public schools will start opening for the new school year in the coming weeks. In my area, students will arrive on Wednesday, August 10th, for the new year. Our schools are still seeking a massive number of classroom teachers to teach our young students. This need goes well beyond the need for classroom teachers. School cafeteria workers, maintenance, janitors, and school bus driver are still needed. In the state of Florida, they are resorting to former military members to fill their needs for staffing their classrooms -- "Qualifying veterans will have served at least four years in the military, with an honorable discharge. Candidates must also have at least 60 college credits under their belt and have attained a 2.5 GPA or higher. They must also have passed the Florida subject-area examination.” In Madison County, North Carolina, the local sheriff is stocking their schools with AR-15 rifles, ammunition, and other assorted items for teachers to use in the event of an active shooter entering one of their schools. A Texas state lawmaker is asking schools statewide to tell him whether they currently hold any of around 850 books on a list he has compiled, explaining that he is targeting materials that "might make students feel discomfort, guilt, anguish, or any other form of psychological distress because of their race or sex." Across our nation, school board meetings are turning into brawling arenas and shouting matches where invectives tinged with racism are the norm. In open and carry states individuals are showing up armed with handguns and AR rifles as a show of intimidation for those attending such meetings. The end result of all this chaos is simply a case of those working in our education system, they are seeking and obtaining employment in a new profession. With this action of teachers fleeing this profession, school districts are being forced into taking a radical change in how our students will be taught now and into the foreseeable future. It is my opinion that Instructure Holdings (INST) will offer an excellent investment opportunity by addressing the changing needs for how our students will be taught in our classrooms. March 30th, 2022: On this date, I submitted an article to SA titled— Instructure Holdings: A Foundational Technology System for Educating our Nation’s Students. As of today’s date, the article has garnered a mere 677 PVs and exactly one comment by a SA reader. The comment made by the poster totally disagreed with the premise and suggestions I made about Instructure. Considering one of the most brutal stock market corrections has occurred since my article was shared, my defense is very simple. Suggesting that my readers consider Instructure as an investment based on my premise that it would become the default solution for how our students will be taught in the future, the stock is up 26.37% since my article was published and ignored by SA readers. The comparator stock that I cited in my original article, PowerSchool Holdings (PWSC), has seen its shares decline in value. Good investors don’t necessarily make their “killings in the market” by buying the "stock of the day" undergoing unsustainable trading without a valid supporting thesis. Finding the good stock before it becomes the front-page story and waiting for the stock to be discovered is in my opinion a good investing philosophy. Therefore, SA is currently running a special contest for contributors— Top Stock With a Catalyst and I’ve decided to update and support with more data, on why I think Instructure is gaining momentum for growing and turning into a profitable investment vehicle for investors. Recap of Main Points from March 30th, 2022: The Future for How We Will Educate Our Students: The point of this new SA article is to introduce my readers to an investment opportunity found in a company known as Instructure Holdings, Inc., listed on the NYSE. Instructure is a Salt Lake City, Utah-based company, created by two graduate students in 2008. The company is a technology-based company that provides clients and their students (K-12 and higher education institutions) the following platforms for 7,000 global customers located in more than 100 countries: Learning Management System Assessment for Learning Actionable Analytics Engaging Content Online Programs - Professional Development Basically, what Instructure provides its clients is a structure that is an all-inclusive system where the instructor/teacher/student has the delivery tools for introducing the concept, modeling the concept, practicing the concept, and eventually assessing if the student has gained proficiency with the concept. There is also a platform option (Professional Development) that allows a school district or a company to organize and manage their staff development needs for their new hires or new elements of their job for existing employees. Each aspect of Instructure’s platforms is readily available to be retrieved from where it is stored on a cloud storage system. Their system has near flawless results for users being able to successfully complete their tasks in a timely manner. The point is that without an educated citizenry we are putting our nation at risk. The most recent national test scores in reading and math reflect the following dismal assessment achievements of our 13-year-old students: The reading and mathematics scores of 13-year-old students fell between 2012 and 2020—the first time in the almost 50-year history of the National Assessment of Educational Progress (NAEP) long-term trend (LTT) assessment—according to results released today by the National Center for Education Statistics (NCES). The performance of 9-year-olds remained the same in both subjects compared to 2012.” Update: Since the original article, the 2021-2022 school year has ended and the normal district/state assessment has been done. The growing issue of students not meeting national standards continues to expand and much of this can be attributed to the massive dropout from the long-term ranks of the better-qualified teachers. In recent months I have been asking individuals (mostly men) in random conversations about whether they had a male teacher during their K-5 education. In my case, I never had a male teacher during these grades, the only males in the building were the principal and the janitor. I haven’t been surprised by the responses I’m now getting from asking others about this question. Just over the weekend, I posed the question to three individuals and two of the three were like me. The other initially said he had two, however, he changed it because one had been his teacher in the 7th grade and had been his science teacher. My point is, that in my day, elementary teachers who taught us the basic and fundamental skills, were all well-educated females, and they were disciplinarians. In my era, the options women had for professional careers were either nursing or teaching. As my memory serves me, all my elementary teachers had taught for decades. Today the latest drop-out rate is around 50%, on a yearly basis. With the current unemployment number reflecting that this metric is sitting at 3.5%, will there be any qualified and trained teachers left in consideration for teaching jobs? Each year Instructure issues a report on the Status of Teaching and Learning in K-12. The latest report was issued on June 27, 2022. This report is well worth the time for parents who had K-12 students enrolled in our nation’s classrooms. One of the more striking issues this report address is the one about parents and their perception of their student’s performance.
Earnings Update: Instructure Holdings, Inc. (NYSE:INST) Just Reported Its Second-Quarter Results And Analysts Are Updating Their Forecasts
As you might know, Instructure Holdings, Inc. ( NYSE:INST ) recently reported its second-quarter numbers. The results...
|INST||US Software||US Market|
Return vs Industry: INST exceeded the US Software industry which returned -30% over the past year.
Return vs Market: INST exceeded the US Market which returned -20.3% over the past year.
|INST Average Weekly Movement||4.3%|
|Software Industry Average Movement||8.9%|
|Market Average Movement||6.9%|
|10% most volatile stocks in US Market||15.8%|
|10% least volatile stocks in US Market||2.8%|
Stable Share Price: INST is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 4% a week.
Volatility Over Time: INST's weekly volatility (4%) has been stable over the past year.
About the Company
Instructure Holdings, Inc. provides cloud-based learning, assessment, development, and engagement systems worldwide. It offers Canvas Learning Management System that includes assessments, analytics, and learning content for K-12 and higher education institutions; Canvas Studio, an online video platform; Canvas Catalog, a course catalog and registration system; Canvas Assessment, a solution for assessments that include MasteryConnect, a robust student assessment management system, and Certica, which provides assessment content solutions and analytics to inform daily instruction in the classroom and data; Canvas Network that allows access to open online courses; Impact that helps K-12 and higher education institutions to improve technology adoption and evaluate impact of educational technology; and Elevate Data Sync, a solution that allows edtech vendors to share learning data between K-12 and higher education applications. The company was founded in 2008 and is headquartered in Salt Lake City, Utah.
Instructure Holdings Fundamentals Summary
|INST fundamental statistics|
Is INST overvalued?See Fair Value and valuation analysis
Earnings & Revenue
|INST income statement (TTM)|
|Cost of Revenue||US$166.31m|
Last Reported Earnings
Jun 30, 2022
Next Earnings Date
|Earnings per share (EPS)||-0.37|
|Net Profit Margin||-11.75%|
How did INST perform over the long term?See historical performance and comparison
Is INST undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score 4/6
Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Key Valuation Metric
Which metric is best to use when looking at relative valuation for INST?
Other financial metrics that can be useful for relative valuation.
|What is INST's n/a Ratio?|
Price to Sales Ratio vs Peers
How does INST's PS Ratio compare to its peers?
|INST PS Ratio vs Peers|
|Company||PS||Estimated Growth||Market Cap|
ALRM Alarm.com Holdings
SPT Sprout Social
INST Instructure Holdings
Price-To-Sales vs Peers: INST is good value based on its Price-To-Sales Ratio (7.2x) compared to the peer average (9.1x).
Price to Earnings Ratio vs Industry
How does INST's PE Ratio compare vs other companies in the US Software Industry?
Price-To-Sales vs Industry: INST is expensive based on its Price-To-Sales Ratio (7.2x) compared to the US Software industry average (4.4x)
Price to Sales Ratio vs Fair Ratio
What is INST's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
|Current PS Ratio||7.2x|
|Fair PS Ratio||4.7x|
Price-To-Sales vs Fair Ratio: INST is expensive based on its Price-To-Sales Ratio (7.2x) compared to the estimated Fair Price-To-Sales Ratio (4.7x).
Share Price vs Fair Value
What is the Fair Price of INST when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: INST ($22.5) is trading below our estimate of fair value ($40.67)
Significantly Below Fair Value: INST is trading below fair value by more than 20%.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.
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How is Instructure Holdings forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?
Future Growth Score1/6
Future Growth Score 1/6
Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: INST is forecast to remain unprofitable over the next 3 years.
Earnings vs Market: INST is forecast to remain unprofitable over the next 3 years.
High Growth Earnings: INST is forecast to remain unprofitable over the next 3 years.
Revenue vs Market: INST's revenue (11.1% per year) is forecast to grow faster than the US market (7.7% per year).
High Growth Revenue: INST's revenue (11.1% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: INST's Return on Equity is forecast to be low in 3 years time (14.6%).
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How has Instructure Holdings performed over the past 5 years?
Past Performance Score0/6
Past Performance Score 0/6
Growing Profit Margin
Earnings vs Industry
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: INST is currently unprofitable.
Growing Profit Margin: INST is currently unprofitable.
Past Earnings Growth Analysis
Earnings Trend: INST is unprofitable, and losses have increased over the past 5 years at a rate of 21.3% per year.
Accelerating Growth: Unable to compare INST's earnings growth over the past year to its 5-year average as it is currently unprofitable
Earnings vs Industry: INST is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (14.5%).
Return on Equity
High ROE: INST has a negative Return on Equity (-4.11%), as it is currently unprofitable.
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How is Instructure Holdings's financial position?
Financial Health Score3/6
Financial Health Score 3/6
Short Term Liabilities
Long Term Liabilities
Stable Cash Runway
Forecast Cash Runway
Financial Position Analysis
Short Term Liabilities: INST's short term assets ($304.1M) do not cover its short term liabilities ($320.0M).
Long Term Liabilities: INST's short term assets ($304.1M) do not cover its long term liabilities ($550.7M).
Debt to Equity History and Analysis
Debt Level: INST's net debt to equity ratio (32.1%) is considered satisfactory.
Reducing Debt: Insufficient data to determine if INST's debt to equity ratio has reduced over the past 5 years.
Cash Runway Analysis
For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.
Stable Cash Runway: Whilst unprofitable INST has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.
Forecast Cash Runway: INST is unprofitable but has sufficient cash runway for more than 3 years, due to free cash flow being positive and growing by 49.2% per year.
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What is Instructure Holdings's current dividend yield, its reliability and sustainability?
Dividend Score 0/6
Cash Flow Coverage
Dividend Yield vs Market
|Instructure Holdings Dividend Yield vs Market|
|Company (Instructure Holdings)||n/a|
|Market Bottom 25% (US)||1.6%|
|Market Top 25% (US)||4.6%|
|Industry Average (Software)||1.1%|
|Analyst forecast in 3 Years (Instructure Holdings)||0%|
Notable Dividend: Unable to evaluate INST's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.
High Dividend: Unable to evaluate INST's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.
Stability and Growth of Payments
Stable Dividend: Insufficient data to determine if INST's dividends per share have been stable in the past.
Growing Dividend: Insufficient data to determine if INST's dividend payments have been increasing.
Earnings Payout to Shareholders
Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.
Cash Payout to Shareholders
Cash Flow Coverage: Unable to calculate sustainability of dividends as INST has not reported any payouts.
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How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Steve Daly (58 yo)
Mr. Stephen M. Daly, also known as Steve, is Chief Executive Officer of Instructure Holdings, Inc. since July 2020 and also serves as its Director since March 2020. Mr. Daly serves as Chief Executive Offic...
CEO Compensation Analysis
|Steve Daly's Compensation vs Instructure Holdings Earnings|
|Date||Total Comp.||Salary||Company Earnings|
|Jun 30 2022||n/a||n/a|
|Mar 31 2022||n/a||n/a|
|Dec 31 2021||US$6m||US$450k|
|Sep 30 2021||n/a||n/a|
|Jun 30 2021||n/a||n/a|
|Mar 31 2021||n/a||n/a|
|Dec 31 2020||US$12m||US$220k|
Compensation vs Market: Steve's total compensation ($USD5.60M) is about average for companies of similar size in the US market ($USD6.85M).
Compensation vs Earnings: Steve's compensation has been consistent with company performance over the past year.
Experienced Management: INST's management team is considered experienced (2.2 years average tenure).
Experienced Board: INST's board of directors are not considered experienced ( 2.5 years average tenure), which suggests a new board.
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: INST insiders have only sold shares in the past 3 months.
Recent Insider Transactions
|07 Sep 22||SellUS$22,034||Melissa Loble||Individual||958||US$23.00|
|30 Aug 22||SellUS$1,290,613||Mitch Benson||Individual||56,581||US$22.81|
|24 May 22||BuyUS$200,013||Lloyd Waterhouse||Individual||12,122||US$16.50|
|16 Mar 22||SellUS$30,167||Melissa Loble||Individual||1,468||US$20.55|
|02 Dec 21||SellUS$62,742||Melissa Loble||Individual||2,898||US$21.65|
|Owner Type||Number of Shares||Ownership Percentage|
Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.5%.
|Ownership||Name||Shares||Current Value||Change %||Portfolio %|
Instructure Holdings, Inc.'s employee growth, exchange listings and data sources
- Name: Instructure Holdings, Inc.
- Ticker: INST
- Exchange: NYSE
- Founded: 2008
- Industry: Application Software
- Sector: Software
- Implied Market Cap: US$3.193b
- Shares outstanding: 141.91m
- Website: https://www.instructure.com
Number of Employees
- Instructure Holdings, Inc.
- 6330 South 3000 East
- Suite 700
- Salt Lake City
- United States
|Ticker||Exchange||Primary Security||Security Type||Country||Currency||Listed on|
|INST||NYSE (New York Stock Exchange)||Yes||Common Stock||US||USD||Jul 2021|
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2022/09/29 00:00|
|End of Day Share Price||2022/09/29 00:00|
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.