dailyloe.com – Samsara (IOT) has experienced a roughly 50% drop from its all-time high, attributed to the so-called “SaaS Apocalypse” and multiple compression. Despite this, Q4 FY26 has been reported as the best quarter in its public company history. The prevailing narrative around seat compression impacting SaaS valuations does not apply to Samsara.
Samsara primarily serves enterprise industrial operators, focusing on return on investment rather than the number of users, typical in white-collar environments. The company’s significant hardware install base generates physical switching costs that competitors relying solely on cloud solutions cannot easily match. Additionally, the integration of an AI layer enhances revenue without replacing existing models.
Valuation analysis suggests a base case target price of approximately $52, indicating a 68% upside at an 11x EV/FY28E revenue multiple. This projection is supported by upcoming catalysts, including the Q1 FY27 earnings report scheduled for May 28 and the Beyond 2026 conference. Conversely, a bearish scenario could see shares drop to around $24, representing a 21% decline if SaaS de-rating persists and if the company fails to meet consensus expectations.
The risk/reward scenario based on the base case is roughly 3.2:1. The market’s current perception may overlook Samsara’s unique advantages in the industrial sector.
