Today’s Stock: Procore Technologies, Inc. (PCOR)Today’s Stock: Procore Technologies, Inc. (PCOR)
Procore Technologies, Inc., together with its subsidiaries, provides a cloud-based construction management platform and related products and services in the United States and internationally. Its platform enables owners, general and specialty contractors, architects, and engineers to collaborate on construction projects
My Thoughts 💭My Thoughts 💭
I first heard about Procore many years ago as I work in the construction industry. I never used the software myself but I heard other A/E firms having success with this platform. It is quite possible I could use this software in the future but as of right now I am unsure.
I used to own two shares of this company back in 2024. At the time I sold I had a modest gain but since I sold the stock is up about 50% but still below its IPO price of $84. In almost 5 years of being on the stock market investors are not impressed with this growth strategy thus it’s trouble to rise above its IPO price.
At 84.9k sats per share (@ $87,734), and no dividend. The company has to grow at a rate that is equal or higher to the expected growth rate of Bitcoin. Some put Bitcoin growing 20% to 30% the next 10 years thus PRCOR has to grow at this rate for it to make sense to dump sats and buy this company. The company is cheap a PE of 9 which makes the investment a bit more attractive.
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The fundamentals of this company appear solid. It has a PE ratio of 9, an estimated growth rate of 100%, a flawless balance sheet, and operates in the construction industry, where margins are extremely tight. Any productivity gains are highly valued, yet the stock is struggling to surpass its IPO price. What could be the reason behind this?
My guess is that artificial intelligence and software play a significant role. The software industry is highly competitive, with major players like Microsoft and smaller companies like Kahua offering alternative project management solutions. Additionally, the operating expenses are quite high, which may raise concerns among investors about the potential for growing margins.
I once owned this stock because it seemed like a straightforward investment opportunity in a software company that was rapidly gaining traction in the construction management sector. However, it appears that they still have some execution risks that they haven’t fully addressed. In light of these factors, I believe that Bitcoin is a better investment at the moment. I’m not interested in investing in a software company to help them grow, and I’m indifferent to whether Procore survives or not.
Procore Acquires Construction Agentic AI Platform Datagrid
Procore, a leading cloud-based construction management platform, said Jan. 20 it has acquired Datagrid to enhance its artificial intelligence strategy and deliver data connectivity for customers. The completed deal, with terms not disclosed, will immediately help contractor customers that seek to autonomously manage submittal reviews and draft requests for information, said Procore.
Datagrid is an AI-powered platform that connects drawings, specs and schedules from several construction and financial management systems into one workspace. Co-founded by CEO Thiago Da Costa and based in San Francisco, the company has seen strong adoption by contractors for everything from process management for submittals and requests for information to financial progress tracking.
The purchase of Datagrid technology, which is designed to work across third-party systems and be data agnostic, gives Procore strength in the agentic AI space and goes beyond suggestions and recommendations available in its current AI offerings such as CoPilots.
In its announcement, Procore said that Datagrid products will immediately be available to its customer, and non customers also.
"While core AI capabilities remain embedded in the Procore platform, the Datagrid offering will support customers with multiple data sources and advanced-reasoning use cases by unifying intelligence, automating intricate tasks, and surfacing critical insights across the complete technology stack," Procore said.
"Modern work has outgrown human capacity for manual processing, said da Costa, who joins Procore in a role to lead AI and data strategy. "Our focus has always been on building an AI that can execute, not just talk. By joining Procore, we can now unlock unprecedented levels of productivity and quality for the thousands of customers who already build on its platform."