Hi there,
We like both of these companies heading into 2021. Both have made some pretty significant acquisitions that should enable them to continue growing at a pretty impressive clip.
It is important to note however, that there is still plenty of uncertainty going into 2021. We are by no means on the other side of this pandemic, and the economy could still be in for a tough go. In terms of valuation, both are actually quite expensive. Since they are not yet profitable, and neither have big debt loads the best gage is P/S ratio. DND and LSPD are trading at ~39 and ~55 times sales - both of which are near all-time highs. That drops to 18 and ~26 times sales on a forward basis based on analysts estimates. Once again - not cheap.
It is however, important to not that it is likely the recent acquisitions are net yet fully reflected in these estimates. Furthermore, DND's entry into Australia is a wildcard and if they can prove as successful there as in the UK and Canada, then it could be an area of hyper growth.
The other thing to make note of, LSPD has ben on the top line in every quarter since going public. It has had mixed results in terms of earnings, but overall it is delivering or beating on expectations. DND on the other hand, only has 2 quarters under its belt. It missed twice on earnings and beat once on revenue. This means that LSPD has thus far, a better track record than DND - which is one of the important factors to take into account when investing in recent IPOs. The more mature the company (in terms of it being a public company) the more faith investors have that impressive numbers are sustainable. One need only look to the skepticism faced by Shopify in its early days as a publicly traded company. As it continued to beat expectations, it gathered more and more respect. There is however, always a risk that it disappoints and that could lead to significant downside for newly listed companies trading at high valuations.
Of note, I am long both companies (as is Dan) and intend to hold them both for next five years unless something materially changes for the worse.
Mat