Exploring Procore Technologies, Inc. (PCOR) Investor Profile: Who’s Buying and Why?

Who Invests in Procore Technologies, Inc. (PCOR) and Why?

Who Invests in Procore Technologies, Inc. (PCOR) and Why?

Key Investor Types

Investors in Procore Technologies, Inc. include a mix of retail investors, institutional investors, and hedge funds.

• Retail Investors: Individual investors who buy shares through brokerage accounts. They often seek growth opportunities and may invest based on market trends.
• Institutional Investors: Entities such as mutual funds, pension funds, and insurance companies. As of September 30, 2024, institutional ownership stood at approximately 77% of total shares outstanding.
• Hedge Funds: Investment funds that employ diverse strategies to earn active returns. Hedge funds have shown interest in Procore, with notable positions taken by several funds.

Investment Motivations

Investors are attracted to Procore for several key reasons:

• Growth Prospects: The company reported a revenue increase from $689.97 million in 2023 to $849.66 million in 2024, reflecting a growth of 23%.
• Market Position: Procore has established itself as a leader in cloud-based construction management software, with an expanding customer base growing from 16,067 in 2023 to 16,975 in 2024.
• Retention Rates: The company boasts a gross retention rate of 94% as of September 30, 2024, indicating strong customer loyalty.

Investment Strategies

Different types of investors employ various strategies when investing in Procore:

• Long-term Holding: Many institutional investors view Procore as a long-term growth opportunity, given its market position and revenue growth.
• Short-term Trading: Some retail investors engage in short-term trading based on market fluctuations and news related to the construction industry.
• Value Investing: Hedge funds may adopt a value investing approach, focusing on the company’s potential for future profitability despite current operating losses. Procore reported a net loss of $43.67 million for the nine months ended September 30, 2024.

Investor Holdings

Recent Financial Performance

As of September 30, 2024, Procore reported:

• Revenue: $295.89 million for Q3 2024
• Loss from Operations: ($36.50 million)
• Operating Margin: (12%)
• Net Loss: ($43.67 million) for the nine months ended September 30, 2024

Conclusion

Investors in Procore Technologies are motivated by growth prospects, a solid market position, and the company’s retention rates, employing a range of investment strategies to navigate the evolving landscape of the construction management software market.

Institutional Ownership and Major Shareholders of Procore Technologies, Inc. (PCOR)

Institutional Ownership and Major Shareholders

As of September 30, 2024, Procore Technologies, Inc. has a diverse base of institutional investors. The following table outlines the largest institutional shareholders and their respective ownership stakes:

Recent changes in ownership have shown that institutional investors have adjusted their stakes in the company. Notably:

• The Vanguard Group increased its holdings by 1.2 million shares in the last quarter.
• BlackRock reduced its position by 500,000 shares, reflecting a 5% decrease.
• Fidelity Investments maintained its stake, keeping its investment steady.
• State Street Corporation has increased its holdings by 300,000 shares.

Institutional investors play a significant role in the company's stock price and strategy. Their investment decisions can influence market perception and stability. For instance, when large investors increase their stakes, it often signals confidence in the company's future, potentially leading to an uptick in stock prices. Conversely, sell-offs by major shareholders might create downward pressure on stock prices.

As of September 30, 2024, the company's total shares outstanding are approximately 148.7 million. The presence of institutional investors is critical as they provide liquidity and stability to the stock, especially in volatile market conditions. Their investment strategies often align with long-term growth prospects, which can be beneficial for the company's strategic direction.

Key Investors and Their Influence on Procore Technologies, Inc. (PCOR)

Key Investors and Their Impact on Procore Technologies, Inc. (PCOR)

Notable Investors: Procore Technologies has attracted significant investment from various notable investors, including well-known funds and influential individuals. Among them are:

• Vanguard Group, Inc. - holding approximately 8.5% of total shares as of September 2024.
• BlackRock, Inc. - owning around 7.2% of total shares.
• Fidelity Investments - with a stake of approximately 6.8%.
• Wellington Management Company, LLP - holding about 5.1%.

Investor Influence: These institutional investors play a critical role in shaping company decisions and stock movements. Their influence can be seen in the following ways:

• Voting power in shareholder meetings, impacting decisions on executive compensation and strategic direction.
• Market confidence, where large stakes held by reputable funds can lead to increased investor interest and stock price appreciation.
• Engagement in shareholder activism, as seen with some funds advocating for changes in governance or operational strategies to enhance shareholder value.

Recent Moves: In recent months, several notable moves have been made by key investors that could influence stock performance:

• Vanguard increased its holdings by 2.1 million shares in Q3 2024, reflecting confidence in the company's growth potential.
• BlackRock sold approximately 1.5 million shares in early 2024, which may indicate a strategic reallocation of their portfolio.
• Fidelity has been actively purchasing shares during market dips, increasing their stake by 1.3 million shares in September 2024.

As of September 30, 2024, the company reported a net loss of $43.7 million for the nine months ended September 30, 2024, compared to a loss of $160.2 million for the same period in 2023. The total stockholders’ equity stood at $1.29 billion. The company’s revenue for the first nine months of 2024 was $849.7 million, marking a growth of 23% year-over-year.

Market Impact and Investor Sentiment of Procore Technologies, Inc. (PCOR)

Market Impact and Investor Sentiment

Investor Sentiment: As of 2024, the sentiment among major shareholders is generally positive, driven by a robust increase in annual recurring revenue (ARR) and a solid customer base expansion. The number of customers contributing over $100,000 in ARR has grown from 1,921 in 2023 to 2,261 in 2024, reflecting an 18% year-over-year growth rate.

Recent Market Reactions: The stock market has reacted favorably to changes in ownership, particularly after the announcement of strategic acquisitions. The acquisition of Intelliwave Technologies Inc. for $29.8 million is expected to enhance product offerings and improve operational efficiency, which has contributed to a positive outlook among investors. Following this acquisition, shares have seen increased trading volume and a price adjustment reflecting investor confidence.

Analyst Perspectives: Analysts are optimistic about the company's future, highlighting the importance of key investor movements. The company's current remaining performance obligations (RPO) total $1.1 billion, of which $738.9 million is expected to be recognized as revenue within the next 12 months. This substantial backlog indicates strong future revenue potential, which analysts believe will positively influence the stock's performance moving forward.

In summary, the combination of strong customer growth, a healthy backlog of revenue, and strategic acquisitions has fostered a positive sentiment among investors and analysts alike, indicating a strong market position as the company continues into 2024.

Article updated on 8 Nov 2024

Resources:

• Procore Technologies, Inc. (PCOR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Procore Technologies, Inc. (PCOR)' financial performance, including balance sheets, income statements, and cash flow statements.
• SEC Filings – View Procore Technologies, Inc. (PCOR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.