Yext, Inc. (YEXT): A Bull Case Theory 

We came across a bullish thesis on Yext, Inc. on Show me the incentives…’s Substack. In this article, we will summarize the bulls’ thesis on YEXT. Yext, Inc.’s share was trading at $8.83 as of September 22nd. YEXT’s forward P/E was 13.39 according to Yahoo Finance.

Yext (YEXT) has become the center of attention following CEO Michael Walrath’s $9 per share take-private proposal, a modest 11.2% premium that many investors see as a floor rather than a final price. The timing of the bid coincides with a clear business inflection point: two transformative acquisitions—Hearsay Systems and Places Scout, have expanded Yext’s capabilities in digital client engagement, structured data, and search analytics. This foundation has enabled the launch of Yext Scout, an AI-driven visibility and benchmarking platform delivering hyper-local, real-time insights across both traditional and emerging AI search platforms like ChatGPT and Gemini.

Early momentum has been strong, with over 1,000 waitlist sign-ups, renewed customer interest, and rising expansion opportunities. Financial performance has also accelerated, with back-to-back quarters of double-digit revenue growth, record Adjusted EBITDA margins above 23%, and steady ARR expansion. At roughly 9–10x EV/AEBITDA and ~2x sales, the valuation appears undemanding for a software platform entering a higher-growth phase. Walrath’s bid comes with committed financing, likely backed by longtime partners Noah and Jonah Goodhart, but his ownership stake of only ~3% and newly revised compensation terms under a change-of-control scenario suggest incentives are aligned for a deal.

Major shareholders such as Lead Edge Capital and Lynrock Lake, with significant stakes and low cost bases, may push for a higher price, potentially drawing in other bidders. With insiders, the board’s special committee, and financial sponsors all positioned for upside, a competitive process could emerge. The $9 offer effectively sets a floor, but given strategic momentum and investor alignment, a bump toward $9.75 or higher looks increasingly probable, making this a potential “pump it up” moment for Yext’s shareholders.

Previously we covered a bullish thesis on Similarweb Ltd. (SMWB) by 1rabbitresearch in November 2024, which highlighted its unique data assets, accelerating revenue growth, and strengthening profitability amid rising digital demand. The company’s stock price has appreciated approximately by 13.18% since our coverage. The thesis still stands as Similarweb’s relevance in analytics continues to expand. Show me the incentives… shares a similar view on Yext but emphasizes its post-acquisition inflection and Scout launch.

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Disclosure: None.