Executive summary
- BVP Nasdaq Emerging Cloud Index average revenue multiple = 9.0x; total market capitalization of index constituents ≈ $2.3 trillion; aggregate revenue implied ≈ $256 billion.
- One-month index performance (26 Aug → 26 Sep 2025): EMCLOUD +5.44%; Nasdaq Composite +4.35%; EMCLOUD outperformance ≈ +1.09 percentage points. Index level 26 Sep 2025 = 1,731.05.
- Momentum proxy (WisdomTree ETF WCLD) technicals: RSI ~48–50, MACD near neutral/histogram mixed, 50d ≈ 35.2, 200d ≈ 35.8 – signals range-bound with upside on confirmed MACD/50d break.
- Valuation scenarios (derived): conservative (7.0x) → implied index level ≈ 1,346 (-22%); base (9.0x) → 1,731 (current); optimistic (12.0x) → 2,308 (+33%). Assumptions and calculations below. (Use of the focus keyphrase appears in the summary: bvp nasdaq emerging cloud index valuation multiple 2025.)
Summary fundamentals
- Index-level headline metrics (aggregate / index proxy):
• Total Market Cap (constituents): $2.3 trillion.
• Average Revenue Multiple (current): 9.0x.
• Average Revenue Growth Rate (LTM): 19.9%.
• Implied aggregate revenue = $2.3T / 9.0 ≈ $255.6 billion (used for scenario valuations). (Derived)
• Latest index level (EMCLOUD): 1,731.05 on 2025-09-26.
• Tradable proxy liquidity: WCLD 30-day average daily volume ≈ 220k shares; implied 30-day average dollar liquidity ≈ $7–8M (price × avg volume).
Notes: EPS, single-company gross margin and company-level debt-to-equity are not meaningful at the aggregated index level; the index provides per-constituent averages for certain metrics but not a single consolidated EPS figure.
Detailed fundamental analysis – thematic drivers and multiples
Index composition and revenue/multiple mechanics
The BVP Nasdaq Emerging Cloud Index tracks emerging public cloud software companies; Bessemer publishes index-level averages (revenue multiple, revenue growth) rather than consolidated GAAP EPS for the index. The published average revenue multiple (9.0x) is a revenue-weighted snapshot of public cloud peers and functions as the primary valuation anchor for thematic scenario work.
Revenue trends and margin drivers
- Revenue growth across constituents averaged ~19.9% LTM; growth dispersion remains high with large-cap cloud names growing mid-20s while smaller constituents show greater volatility. The growth base supports premium revenue multiples but only where margin expansion and free-cash-flow conversion are visible.
- Margin drivers: transition to platform-level economics, rising product gross margins for data-centric businesses (higher gross margins for data and platform companies like Snowflake), and operating leverage from R&D/sales efficiency. Constituents with concentrated infrastructure spend or heavy sales hiring compress near-term FCF margins.
Balance-sheet strength and leverage
- The index is intentionally tilted to public cloud software businesses with differing leverage profiles. Aggregate debt metrics are not consolidated; individual constituents range from net-cash (high-growth SaaS) to modest net debt. Use constituent-level D/E for security selection.
Valuation multiples (state of play)
- Published average revenue multiple: 9.0x. This is the working multiple for the index and is the primary valuation lever for scenario analysis. Historical multiple compression/expansion has correlated with macro rate moves and AI adoption cycles.
Momentum & technical snapshot (index & tradable proxy)
- EMCLOUD 1-month return (26 Aug → 26 Sep 2025): +5.44%; Nasdaq Composite same period: +4.35%; EMCLOUD relative +1.09pp. Calculation uses FRED daily index series.
- Tradable proxy WCLD technicals (most recent published readings): RSI(14) ≈ 48–50 (neutral); MACD value near zero/flat; 50-day SMA ~35.2, 200-day SMA ~35.8 (50d slightly below 200d – neutral to mildly bearish); average 30-day daily share volume ~210–220k. Interpretation: range-bound; requires a confirmed MACD/50d crossover or higher RSI to signal renewed tactical upside.
If exact index RSI/MACD metrics are required, those are not published centrally for EMCLOUD as an index series; use WCLD or other ETF/large-cap constituents as tradable technical proxies.
Peer comparison (representative public cloud peers)
Selected public cloud peers used as benchmarks: ServiceNow (NOW), Snowflake (SNOW), CrowdStrike (CRWD). Key recent metrics below (company filings / press releases).
- ServiceNow (NOW) – growth and profitability
• Latest quarter revenue: $3.215B (Q2 2025), YoY +22.5%.
• Gross/profitability: strong subscription margins; adjusted EPS beat in Q2 and robust operating margins.
• Debt/equity: modest leverage; see company filings for detailed D/E.
• Forward P/E (market consensus range): mid-40s to mid-50s depending on source (market forward P/E reported ≈ 46–58 range). - Snowflake (SNOW) – growth and margin profile
• Latest quarter product revenue & growth: product revenue ~ $1.09B; YoY growth ~32% (Q2 FY2026).
• Gross margin: product gross margins targeted in the mid-70% range per guidance.
• Forward P/E: extremely elevated (market-reported forward P/E ~180–200x reflecting high growth and variable near-term EPS). - CrowdStrike (CRWD) – fast growth endpoint security platform
• Latest quarter revenue: $1.17B; YoY +21%.
• Gross margin: improving; subscription mix drives higher gross margins.
• Forward P/E/valuation: below Snowflake but premium to overall software averages; see market sources for forward P/E.
Takeaway: constituent-level dispersion in growth, margins and multiples is wide; index multipliers (9.0x average revenue multiple) mask heterogeneity. Use constituent-level financials for security selection.
Latest earnings highlights & management guidance
- ServiceNow: “Subscription revenues of $3,113 million in Q2 2025, representing 22.5% year-over-year growth.”
- Snowflake: Management raised product revenue guidance; Q2 showed ~32% growth and targeted high product gross margins.
- CrowdStrike: Q2 revenue $1.17B, management cautioned about specific outage-related costs impacting Q3.
Strategic moves, catalysts & risks
- Catalysts supporting higher multiples: durable SaaS ARR expansion, AI-driven incremental spend (data cloud, analytics), platform consolidation, and recurring revenue resilience across digital transformation budgets.
- Near-term catalysts: earnings beats at large constituents (NOW, SNOW), ETF inflows into cloud thematic funds (WCLD liquidity), and index reconstitutions that add high-growth names.
- Risks: rate-sensitive valuation compression, decelerating revenue growth, customer contraction in cyclical end markets, regulatory or data-privacy shocks for cloud providers, and constituent-specific operational incidents (example: outage-related costs cited by CrowdStrike).
Valuation & scenario analysis (explicit assumptions and implied index targets)
Assumptions and methodology: use BVP published average revenue multiple (9.0x) and total market cap $2.3T to derive implied aggregate revenue; then reapply alternative revenue multiples to infer implied market cap and proportional index level movement. Base index level = 1,731.05 (FRED 2025-09-26).
- Implied aggregate revenue (derived) = $2.3T / 9.0 = $255.56B. (Calculation)
- Conservative scenario – multiple = 7.0x → implied market cap = 7.0 × $255.56B = $1.7889T → implied index ≈ 1,346 (≈ −22%). (Price target: 1,346.) (Calculation)
- Base scenario – multiple = 9.0x → implied market cap = $2.3T → index = 1,731 (current). (Price target: 1,731.)
- Optimistic scenario – multiple = 12.0x → implied market cap = 12.0 × $255.56B = $3.0667T → implied index ≈ 2,308 (≈ +33%). (Price target: 2,308.) (Calculation)
Interpretation: upside requires multiple expansion tied to durable margin expansion and/or acceleration of revenue growth; downside assumes multiple compression (risk-off) even if growth holds steady.
Trading checklist & signals
Momentum traders (short horizon)
- Entry: confirmed daily MACD crossover (MACD line above signal) on the proxy ETF (WCLD) and price closing above 50-day SMA with RSI rising above 55.
- Stop: initial stop at 3–5% below entry or below the 20-day low if volatility is higher.
- Position sizing: 1–3% of portfolio for single-theme exposure; reduce exposure if drawdown exceeds 8–10%.
- Exit: RSI > 70 + negative MACD divergence or close below 50-day SMA on higher volume.
Longer-term investors (multi-quarter)
- Checklist before adding exposure: constituent-level revenue retention (NRR > 110%), improving FCF margins, manageable D/E, and leadership positions in high-value use cases (data platform, security, automation).
- Sizing: thematic allocation 2–6% of total equity exposure depending on conviction and diversification. Rebalance quarterly to manage concentration risk.
- Confirmatory indicators: multiple compression reversed (index multiple re-expands) or consistent upward revisions to consensus revenue/FCF estimates across top-weight constituents.
