Global-e Online Ltd. (GLBE)

By both methods, the value today (DCF $62 · Multiples $58) exceeds the market price ($38).

Today — fairly valued: at $38 trades ~33.4% below its value discounted to today (~$58); the discount is positive but does not reach the margin of safety we require (≥38%).

At 5 years — Infravalorado: the target price ($72) plus dividends yield above the required average return (10%) — the business compounds.

The bridge: the return at 5 years exceeds the risk-free rate (4.5%) — but the discount does not reach the required margin of safety (≥38%). To require a 15% annual return, it would need to be bought at ~$36.

Educational / informational. Does not constitute investment advice.

The inverse approach: instead of projecting growth to obtain the value, the market price ($38) is taken as given and it solves for what annual owner-earnings growth would need to hold for 5 years for the present value —at the method's rate (4.5%, no-growth terminal)— to equal that price. It is the disconfirmation test: the expectations the price already pays for, contrasted against the method's projection.

The market discounts less growth (19.3%/year) than we project (33.0%/year) → if the base case holds, there is margin: perception is more pessimistic than the estimated reality.

That growth implies ~$0.3 bn of owner earnings in year 5 (vs ~$0.5 bn of our base case). It recalculates if the DCF assumptions are edited.

Year-by-year projection of the selected scenario. From each year, two versions of the flow are derived: growth FCF (operating flow − total capex, the cash surplus) and maintenance FCF (the owner earnings: what the business yields if it only sustains its capacity). Cash accumulates the retained surplus —what is not returned as dividend or buyback—, so that EV falls and multiples compress going forward. The valuation is done on NOPAT. In edit mode, revenue, margins, capex, and exit multiples can be adjusted.

Year 0 (TTM ended Jun 30, 2026) is built by levels from the Aug 12, 2026 release: revenue = 962.195 + 551.086 − 404.759 = US$1,108.5 million; operating income = 71.670 + 77.651 − (−8.672) = US$158.0 million (14.3% margin); net income = 68.270 + 78.078 − (−7.365) = US$153.7 million. Year 1's starting point follows the guidance raised on Aug 12, 2026 for fiscal year 2026 (revenue US$1,305-1,355 million, midpoint US$1,330 million, +38% against 2025's US$962.2 million) — a deliberate acceleration against the prior year's +27.8%, not a typo. The adverse and favorable scenarios anchor on the extremes of that same guided range (US$1,305 and US$1,355 million), applied as a growth rate over year 0 to preserve the rolling grid. The margin inflection is structural: amortization of the Shopify commercial agreement asset (the warrants delivered as consideration) was US$150.5 million in 2023, US$148.6 million in 2024 and US$66.0 million in 2025, and it was fully amortized as of January 2026 (only US$0.5 million in the first half of 2026 against US$49.9 million a year earlier) — that non-cash cost has stopped recurring, and it is the main driver of the margin improvement already visible in the TTM, not a one-off that needs reversing. The tax rate used (23%) is Israel's statutory federal rate per the FY2025 20-F's own reconciliation (tax note): on implied pre-tax income of ~US$70.5 million, the theoretical tax at 23% is US$16,215 thousand, against actual tax of just US$2,229 thousand (3% effective) — the difference is a US$19.9 million change in the valuation allowance for deferred tax credits, an artifact of the year tied to the US$536 million accumulated deficit that is only now beginning to reverse as the company turns profitable, and not the rate the business pays in steady state. The buyback is modeled with `sharesPath` (no additional cash is accumulated): the diluted count fell from 175.588 to 175.125 million between the second quarter of 2025 and that of 2026 despite dilution from stock-based compensation, with the US$200 million plan completed in the second quarter of 2026 (US$68 million executed that quarter) and a new US$500 million authorization approved on Jun 4, 2026 — the revealed net reduction (~0.5%/year) is used, not the authorization, which is a ceiling. The valuation metric is NOPAT (net operating profit after taxes): operating cash flow is inflated by the float of client funds in transit (funds receivable from and payable to clients, which net out exactly on the balance sheet) and by working-capital swings tied to bonds and seasonality, so it is not used for the multiples valuation.

Today's elevated multiple is the price of growth: if the business grows, the entry point cheapens on its own going forward (the metric grows while EV stays roughly flat). The exit multiple at 3 years is higher than the terminal at 5 years —at 3 years there is more growth still ahead—, so the value curve shows whether value creation is concentrated in the early or the later years. The required return is applied to the base scenario.

They are valued separately, with their own rationale, and are not incorporated into the base or the verdict (they are excess return). When assigning them value — in Editmode —, the total with optionalities updates live, without moving the base.

The verdict, the base CAGR, and the margin of safety are always calculated on the base; optionalities do not alter them (with optionalities at $0 they do not move).

Each card fixes a required annual return and answers: if the business is worth $72 in 5 years, what is the maximum that can be paid today to obtain that return? Since it now trades at $38, the margin of safety is how much cheaper the market is than that maximum. The three thresholds: 4% covers inflation (the floor), 10% is the long-term average return, and 15% is the level of a great investment.

With a target price of $72 in 5 years and a required return of 4.5% annually, the maximum to pay today is $58. Against the current market price ($38), the margin of safety is 33.4% (trades below the maximum → there is margin) and the total return at that price would be 13.4% annually.

• Multiple near the floor of the band. Terminal EV/NOPAT near the floor of [20,30] given the 45% gross margin, not that of pure software.
• Guidance just raised not reflected. The stock trades 9% below its 52-week high despite the guidance raised on Aug 12, 2026.
• No debt. Cash and equivalents plus short-term investments above US$500 million, with no financial debt.
• Historical accounting distortion. The Shopify agreement amortization and the erratic tax rate made GAAP earnings hard to read through 2025.
• Material buyback. Growing capital return via buybacks, with a new authorization 2.5 times larger than the one completed.

Each margin over sales, year by year: historical (solid line) → projection (dotted).

• ✓ ROIC exceeds the cost of capital (~10%)
• ✓ CFROIC backs up the ROIC (112%, cash vs. accruals)
• ✓ Healthy balance sheet (low corporate debt)
• ✓ Durable competitive moat (multiple advantages)

• Earnings quality. The positive GAAP operating income in 2025 does not depend on new accruals, but on a historical non-cash cost (the Shopify agreement amortization) that stopped recurring.
• Cash conversion. Reported free cash flow is inflated by the float of client funds in transit and by seasonal, bond-related working-capital swings, so accrual-to-cash conversion is not directly comparable year over year.
• Return on invested capital. Capital-light business (capex of just 0.3% of revenue), with relatively low invested capital, which favors a high return once operating income is sustained.
• Reinvestment runway. Growth is funded almost entirely with working capital and operating spend, not capex; productive reinvestment goes into technology and the geographic expansion of Managed Markets.
• Margin predictability. The erratic effective tax rate (3% in 2025) and the now-extinguished Shopify agreement amortization still make it hard to project GAAP earnings forward with precision.
• Stock-based compensation. Stock-based compensation expense runs around 4% of revenue and still dilutes at nearly the same pace that the buyback reduces the share count.

Annual levels from the official filing (10-K); the % over each bar is the year-over-year (YoY) growth vs the prior year.

The driver is volume times take rate: GMV grew 35% in 2025 while revenue grew 28%, so the monetization rate compresses slightly (15.5% in 2024 to 14.4% in the TTM). No single merchant exceeded 8.5% of 2025 GMV, so customer concentration is not a material risk. The second quarter of 2026 shows the same pattern at the quarterly level: GMV +44% against revenue +39%. The 122% net dollar retention is the strongest signal of organic expansion within the existing base, and it explains why the deceleration in total growth does not reflect merchant losses but the natural maturation of an ever-larger base.

The % are the annual (year-over-year) growth: each year —historical and projected— vs the prior one; the TTM (trailing 12m) vs the TTM of a year ago, to avoid overlapping windows. The historicals are exact figures from the official filings; the projected years come from the year-by-year model (the intermediate years without their own series are interpolated between the anchors). The projected columns (+1y…+5y) are 12-month windows counted from the TTM close (30-jun-2026): the projection starts from the most recently reported data, not the fiscal year. The projected base is realistic and unbiased — the risk discount is applied at the end, via the required return. The rationale for each metric is in the (i).

• Guidance raised. On Aug 12, 2026 the company raised guidance for revenue, GMV and adjusted EBITDA for the full 2026 fiscal year.
• Net dollar retention. 122% in 2025 sustains growth without relying only on new merchants.
• Market penetration. 2025 GMV of US$6,569 million against a cross-border e-commerce market the company estimates at more than US$1 trillion.
• Consistent deceleration. GMV growth went from 45% to 37% to 35% over three years; the company itself warns this is not indicative of the future.
• Compression of the monetization rate. Revenue over GMV fell from 15.5% (2024) to 14.4% (TTM), a sign that growing means giving up some commission.

• Recurrence and operational integration. Contracts with a minimum 12-month term and daily integration into the merchant's order flow generate high recurrence.
• Net dollar retention. 122% in 2025: the existing base expands its spend without needing new merchants.
• Customer concentration. No single merchant exceeded 8.5% of 2025 GMV.
• Structural gross margin. 45% GAAP, capped by the half of revenue that is logistics resale, not pure software.
• Dependence on the Shopify relationship. Meaningful distribution channel, with exclusivity narrowed to the first-party solution in 2025.
• Exposure to a single destination market. 53% of revenue comes from buyers in the United States, the one most exposed to the de minimis exemption risk.
• Growth deceleration. Revenue growth fell from 39% to 32% to 28% over three consecutive years.

• ✓Leverage (net debt / EBITDA)Net cash $0.5 bn
• –Interest coverage (EBIT / interest)no data
• –Liquidity (current ratio)no data
• ✓Cash quality (CFROIC vs ROIC)CFROIC backs 112% of ROIC
• ✓Value creation (ROIC − 10% bar)+10pp
• ✓Malinvestment test (capex vs incremental ROIC)Capex/D&A 0.0x — no over-investment
• !Float / working capitalConsumes cash $0 bn (positive WC)
• !Dilution (SBC % of revenue + shares)SBC 3.5% of revenue

A traffic-light interpreted by the method (not generic): float (negative WC) adds up, capex is judged by incremental ROIC (malinvestment test), and a lender is not subjected to corporate solvency. The (i) shows the derivation of each number.

• Cash position. Cash, deposits and marketable securities of more than US$500 million as of the close of the second quarter of 2026.
• Financial debt. No financial debt on the balance sheet.
• Client float. Funds receivable from and payable to clients in transit net out exactly on the balance sheet.

• Founder continuity. Amir Schlachet, founder, has remained CEO since the company's IPO.
• Recent capital allocation. Completed a US$200 million buyback plan in the second quarter of 2026 and authorized a new one for US$500 million.
• Guidance transparency. Introduces quarterly guidance and raises the annual figure with an explicit breakdown of Passport's contribution.
• Ownership disclosure. Foreign private issuer with no DEF 14A; no public breakdown of management's share ownership.
• Stock-based compensation. Stock-based compensation expense (US$21 million in the first half of 2026) still dilutes at nearly the same pace that the buyback reduces the count.

• Recent history of GAAP losses (2023-2024) that delays recognition of the margin-regime shift
• Non-economic amortization of the Shopify commercial agreement that distorted GAAP results through 2025
• Erratic effective tax rate (3% in 2025) from the reversal of the deferred tax credit valuation allowance, which complicates reading reported earnings
• Israeli foreign private issuer, with lower analyst coverage relative to a comparable U.S. software company

The combination of motivated sellers and missing buyers seems to apply here: the company carries three years of GAAP operating losses through 2025, with a large and declining non-cash cost (the amortization of the Shopify commercial agreement) that masked underlying profitability, and a 3% effective tax rate in 2025 that looks nothing like the 23% statutory rate -two sources of accounting noise that a superficial reader of the income statement can mistake for fragility instead of the resolution of two temporary artifacts. The stock trades 9% below its 52-week high despite the company having just raised guidance on all three metrics.

The annual return (CAGR at 5 years) in each scenario, with the total period return below — the margin of safety made visual: upside range wide, downside range narrow.

Even in the bear scenario, the return holds at ~0%/year (-2% total): the margin of safety protects the downside. The bull (+26%/year, +221% total) exceeds it comfortably — a favorable asymmetry, with a narrow downside range and a wide upside range.

• Agentic AI commerce. Autonomous purchasing agents could reduce the role of the storefronts and payment flows the platform relies on, with regulatory frameworks not yet defined.
• De minimis exemption and tariffs. Changes to United States trade policy could make delivery more expensive for buyers in its largest destination market (53% of revenue).
• Relationship with Shopify. The agreement is terminable by either party and already lost exclusivity for third-party solutions in 2025.
• Merchant retention. Contracts are terminable for convenience with prior notice and no obligation to renew.
• Geopolitical risk in Israel. The company is incorporated and partly operates from Israel, with risks tied to the ongoing conflict in the region.
• Growth deceleration. Three consecutive years of slower revenue and GMV growth.
• Sealed earnings release. The company's 6-Ks seal the period as their own filing date, which requires identifying each quarterly release by hand instead of relying on the period field.

Each thinker's analytical framework applied to our data.

• Buffett / Graham Quality + margin of safety

  A wide moat and ROIC 20% above the 10% bar, but the margin is limited (+33%) → excellent business at a fair price.

• Peter Lynch Growth at a reasonable price (GARP)

  A hyper-growth growing 33% at a multiple/growth of 1.6 → reasonable for its growth.

• Joel Greenblatt Cheap and high-return (Magic Formula)

  Earnings yield 3% (EBIT/EV) + ROIC 20% → falls outside the Magic Formula.

• Howard Marks Perception vs reality + cycle

  The price discounts 19% vs our 33%: perception is more pessimistic than reality, with an identified source of the discount.

• Seth Klarman Capital protection (bear scenario)

  Bear-scenario floor -0%/yr, bull-scenario ceiling +26%/yr over 5y → capital protected, asymmetry in your favor.

• Pat Dorsey Moat strength (Five Rules)

  A wide moat, stable; sources: switching costs, network effects, efficient scale, intangibles → passes the Five Rules.

• Aswath Damodaran Expectations implied by the price

  Justifying the price requires discounting 19%, within what we project (33%) — the story squares with the numbers.