GDYN

Grid Dynamics is a fast-growing enterprise-AI transformation services firm with a genuinely fortress balance sheet, and the market is barely charging for the operating business. Revenue has compounded from $211M (FY2021) to a record $412M (FY2025, +17.5% YoY), with growth accelerating and MD&A crediting demand 'across our core verticals and contributions from our acquisitions.' Critically, cash & equivalents are $342M against total liabilities of just $70.8M (liabilities/equity 0.13x) and no meaningful debt. Strip that cash out and the enterprise value is roughly $178M — about 0.4x FY2025 sales and ~3.3x the $53.8M non-GAAP EBITDA. For a double-digit grower generating $40.6M of operating cash flow (+34% YoY), that is an undemanding price.

The headline valuation looks the opposite of cheap, and that mismatch is the whole thesis. The 55.4x P/E is misleading: GAAP net income of $9.67M rests on a still-negative operating result (loss from operations of $1.9M, a -0.5% operating margin), so the reported profit is largely 'other income' — i.e. interest earned on that $342M cash pile — not operating leverage. The right lens here is EV/EBITDA and EV/sales, both of which flag value, not froth. GAAP profitability has nonetheless inflected the right way: operating loss narrowed for a third straight year ($5.6M → $2.1M → $1.9M) and net income swung from a $1.8M loss (FY2023) to $4.0M (FY2024) to $9.7M (FY2025).