After the success of ABCL and RBLX, I’m officially on the hunt for the next stock that could pay me… in free shares.
And today, F5 Inc. (FFIV) dropped the kind of quarterly report that makes my investing ears perk up like a caffeinated meerkat.
Time to take a closer look.
🔍 What Does F5 Do, Anyway?
F5 is a veteran of the internet infrastructure world. It started out with load balancers (basically traffic cops for your web traffic), and over time pivoted hard into multi-cloud application security and software-defined networking.
Today, F5 helps keep apps running smoothly, securely, and fast — no matter if they’re in AWS, Azure, on-premise, or some dark server closet in Omaha.
🧾 Q3 FY2025: The Numbers Look Great
F5 just reported Q3 results that smashed expectations.
- Revenue: $780M (+12% YoY) — beat estimates by a wide margin
- EPS (non-GAAP): $4.16 — way above expectations
- Free Cash Flow: $282M
- Recurring Revenue: ~73% of total sales
- Non-GAAP operating margin: 34.3%
- Guidance raised for FY25: now expecting ~9% revenue growth and even faster earnings growth
In plain English? Growth is back. Margins are juicy. And they’re raising the bar.
📊 The Valuation: Not Cheap, But Not Crazy
Let’s talk ratios:
| Metric | Value |
|---|---|
| P/E (TTM) | ~28× |
| Forward P/E | ~19.8× |
| PEG | ~1.3× |
| Price/Sales | ~6.0× |
| EV/EBITDA | ~19.8× |
| Price/Book | ~5.2× |
It’s not a value stock. But with this kind of growth, I don’t need it to be. I just want sustainable expansion, solid profits, and no debt black hole.
🏦 Balance Sheet? Bulletproof
F5 is sitting on a pile of cash and practically no debt.
- Cash: $1.43B
- Debt: $229M
- Net Cash: ~$1.2B
- Debt/Equity: 0.07
- Debt/EBITDA: ~0.25
This isn’t a company that’s praying for lower interest rates — they’re already self-sufficient.
🎯 Why It’s a “Double Up, Free Stock” Candidate
This could be textbook material for my favorite Double Up, Free Stock strategy:
- I put $100 in FFIV
- If it doubles to $200 → I sell half
- The rest? Mine. Free.
Low capital at risk. High psychological satisfaction. And in this case, backed by a company with real numbers and a solid moat.
Bonus: F5 regularly buys back shares. The float is shrinking.
⚠️ Risks? Always.
Let’s be honest — F5 isn’t invincible.
- Competition from Cisco, Palo Alto, and cloud-native players
- If growth slows, valuation could contract
- Shifts in enterprise IT budgets are always a wildcard
But… the current quarter says “no signs of slowing.”
🟨 Trade Idea Snapshot
| Metric | Value |
|---|---|
| 📍 Ticker | FFIV |
| 🧠 Thesis | Multi-cloud infra & security tailwinds |
| 💰 Entry Plan | TBD (around $190?) |
| 📈 Strategy | Double Up, Free Stock |
| 🧮 Forward P/E | ~19.8× |
| 📈 Est. EPS Growth | 14–15% |
| 💵 Net Cash | ~$1.2B |
| 🔥 Risk | Slowing cloud spend, competition |
| 📦 Buybacks | Yes |
TL;DR
- F5 (FFIV) just dropped strong earnings, raised guidance, and is sitting on a ton of cash.
- It’s not cheap — but with 15%+ EPS growth, it doesn’t need to be.
- Could it be another Double Up, Free Stock success? That’s what I’m watching for.
Because the best time to plant a free share… is before it doubles.
BUY, SELL, KEEP 
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