Monday.com's Growth Reset Meets the Lawsuit Deadline on the Same Day

monday.com Ltd. (MNDY) reports first-quarter fiscal 2026 earnings before the market opens on May 11, 2026, with analysts expecting $0.34 per share on revenue of approximately $339 million. The central question: can the work operating system provider sustain its recent streak of dramatic earnings beats amid a challenging software market environment? With shares trading at $72.07—down nearly 50% from 100-day and 200-day moving averages—the stakes are high for a company that has exceeded estimates by triple-digit percentages in three of the past four quarters.

Part 1: Earnings Preview

monday.com operates a cloud-based Work Operating System (Work OS) that enables teams to plan, organize, and track work through customizable workflows, serving use cases from marketing campaign management to software development sprints. The company's visual, no-code platform has positioned it as a key player in the collaborative work management space, competing with established SaaS providers like Atlassian and Asana.

For the quarter ending March 2026, analysts project earnings of $0.34 per share—a sharp 34.62% decline from the $0.52 reported in the same quarter last year (Q1 2025). The most recent quarter (Q4 2025) delivered $0.29 per share, beating estimates of $0.12 by 141.67%. Revenue expectations stand at $339.31 million, representing 20.22% year-over-year growth from $282.25 million in Q1 2025, though the consensus estimate range is narrow ($338.1M to $344.4M), suggesting limited uncertainty around the top line.

Three key themes define this earnings story:

Enterprise Expansion and Customer Growth: Investors will scrutinize whether monday.com can maintain momentum in landing larger enterprise deals while expanding within its existing customer base. The company's ability to move upmarket and increase average contract values has been central to its growth narrative, particularly as it competes for budget dollars in a cautious IT spending environment.

Profitability Trajectory and Operating Leverage: With the stock under pressure and analysts cutting price targets significantly (consensus down from prior levels), the path to sustained profitability matters more than ever. The company's recent quarters have shown improving margins—Q4 2025 posted a 9.64% net margin—and investors will watch whether operational efficiency gains can offset any revenue growth deceleration.

AI and Product Innovation Impact: monday.com has been integrating AI capabilities into its platform, and the market will assess whether these enhancements are driving customer adoption and differentiation. The company's ability to demonstrate tangible ROI from AI features could be crucial for justifying its valuation multiple in a software sector facing AI disruption concerns.

Analyst commentary heading into the release reflects caution. Multiple firms have slashed price targets following the February earnings report—BTIG Research cut from $210 to $135, Oppenheimer reduced from $200 to $130, and Needham dropped from $250 to $125. Loop Capital set a particularly bearish $80 target. Despite the downgrades, the consensus maintains a "Moderate Buy" rating with a mean target of $108.73, though sentiment has deteriorated over the past month. Analysts appear to be recalibrating expectations for growth rates and valuation multiples in light of broader software sector headwinds.

Part 2: Historical Earnings Performance

monday.com has established a pattern of consistently exceeding earnings expectations, though with significant volatility in both beat magnitudes and underlying performance. Over the past four quarters, the company has beaten estimates in three of four reports, with surprise percentages of +1,200% (Q1 2025), +150% (Q3 2025), and +141.67% (Q4 2025). The lone miss came in Q2 2025, when the company reported $0.03 versus an estimate of $0.17—an 82.35% shortfall that stands out as an anomaly in an otherwise strong track record.

The magnitude of beats has been extraordinary, particularly in Q1 2025 when actual EPS of $0.52 crushed the $0.04 estimate by twelve times. However, this pattern also reveals significant analyst uncertainty about the company's earnings power, with estimates frequently proving too conservative. The Q4 2025 result of $0.29 versus $0.12 estimated continued this trend, though the beat magnitude moderated from earlier quarters.

Looking at the year-over-year comparison, the upcoming quarter faces a challenging comparison: analysts expect $0.34 versus the $0.52 reported in Q1 2025, implying a 34.62% decline. This represents a notable deceleration and suggests either that Q1 2025's result was unusually strong or that analysts are building in more conservative assumptions after being repeatedly surprised to the upside. The pattern suggests investors should focus less on whether monday.com beats estimates—it usually does—and more on the quality of the beat, forward guidance, and underlying business metrics.

Note: These figures reflect diluted GAAP earnings per share, reported before non-recurring items, and may differ from the non-GAAP figures used by some sources.

Part 2.1: Price Behavior Around Earnings

monday.com reports earnings before the market open, meaning Day 0 represents the first full trading session where investors can react to results, while Day +1 captures follow-through momentum.

Historical price action around earnings reveals extreme volatility, with an average absolute Day 0 move of 17.62%—more than double the typical software stock's earnings reaction. The direction has been highly unpredictable: the past eight reports produced four positive and four negative Day 0 moves, ranging from a +26.46% surge (February 2025) to a -29.80% plunge (August 2025). Notably, the most recent report (February 2026) triggered a -20.79% decline despite the company beating estimates, suggesting investors focused on guidance or other forward-looking metrics rather than the quarterly beat itself.

Day +1 follow-through has been more muted, averaging 2.59% in absolute terms, though still elevated compared to typical post-earnings drift. The largest Day +1 move was +4.05% following the May 2025 report, which saw minimal Day 0 reaction (+0.33%) before investors digested the results more fully. Intraday volatility has also been substantial, with Day 0 trading ranges averaging 8.90% and Day +1 ranges averaging 5.82%.

Investors should prepare for significant price swings regardless of whether the company beats or misses estimates. The stock's reaction appears driven more by forward guidance, revenue growth trajectory, and profitability metrics than by the headline EPS figure. The pattern of large Day 0 moves followed by smaller Day +1 adjustments suggests most of the price discovery happens in the immediate reaction, with limited opportunity for late positioning.

Part 2.2: Options Market Expected Move

The options market is pricing an expected move of ±16.28% ($11.73) through the May 15 expiration, slightly below the 17.62% average absolute Day 0 move from the past eight earnings reports. This suggests options traders are anticipating volatility in line with recent history, though perhaps slightly less extreme than the largest historical swings. The implied move range of $60.34 to $83.80 encompasses a wide potential outcome, reflecting continued uncertainty about the company's trajectory.

Part 3: What Analysts Are Saying

Analyst sentiment on monday.com has deteriorated significantly, with the consensus average recommendation declining to 4.36 from 4.52 one month ago. The current breakdown shows 16 Strong Buy ratings (down from 18 a month ago), 2 Moderate Buy ratings (unchanged), and 7 Hold ratings (up from 5), with no Sell or Strong Sell ratings among the 25 analysts covering the stock. This shift toward more cautious positioning reflects the broader reassessment of software valuations and growth expectations.

The consensus price target of $108.73 implies 50.9% upside from the current price of $72.07, though the wide range of targets—from a low of $75.00 to a high of $176.00—reveals significant disagreement about the company's fair value. The low-end target of $75 sits barely above the current price, suggesting at least one analyst sees limited near-term upside, while the high-end target of $176 implies more than a double from current levels.

The deterioration in sentiment appears driven by multiple factors: concerns about software spending in a challenging macro environment, questions about the sustainability of monday.com's growth rates, and a broader repricing of high-multiple SaaS stocks. The concentration of ratings in the Strong Buy category (16 of 25) suggests many analysts still believe in the long-term story, but the recent downgrades and target cuts indicate a recalibration of near-term expectations. The absence of any Sell ratings is notable—even bearish analysts appear to be moving to Hold rather than recommending outright sales, suggesting a view that much of the downside may already be reflected in the current price.

Part 4: Technical Picture

The Barchart Technical Opinion currently registers a 56% Sell signal, showing modest improvement from 64% Sell one week ago but a significant deterioration from 100% Sell one month ago. This evolution suggests the stock may be stabilizing after a severe downturn, though the overall technical picture remains cautious heading into earnings.

Timeframe Analysis:

• Short-term (50% Sell): Moderate sell signal indicates near-term momentum remains negative, though less extreme than in recent weeks
• Medium-term (50% Sell): Moderate sell signal suggests the intermediate-term trend has not yet reversed despite recent stabilization
• Long-term (100% Sell): Strong sell signal reflects significant weakness in the longer-term trend, with the stock well below major moving averages

Trend Characteristics: The technical environment shows Good strength with a Weakening direction, suggesting the downtrend may be losing momentum but has not yet reversed—a potentially constructive setup if earnings can provide a positive catalyst.

The stock's position relative to moving averages tells a story of severe technical damage with recent stabilization attempts. At $72.07, MNDY trades above its 10-day ($71.62), 20-day ($68.83), and 50-day ($70.60) moving averages, indicating short-term momentum has turned positive. However, the stock remains below its 5-day ($75.14), 100-day ($94.50), and 200-day ($142.38) moving averages, with the 100-day and 200-day levels sitting 30.9% and 97.5% above the current price, respectively. This configuration—above short-term averages but well below longer-term ones—is typical of a stock attempting to form a bottom after a significant decline.

Key technical levels to watch include the 5-day moving average at $75.14 as immediate resistance and the 50-day at $70.60 as nearby support. The 100-day moving average at $94.50 represents a major overhead resistance level that would need to be reclaimed for a meaningful trend reversal. The overall technical setup is cautiously constructive for earnings: the stock has stabilized above short-term support levels and shows signs of bottoming, but remains deeply oversold on longer timeframes. A strong earnings beat with positive guidance could provide the catalyst needed to break above near-term resistance and begin repairing the technical damage, while a disappointment could send shares back toward the $60 level implied by the options market's downside range.