SPS Commerce (SPSC)

Published 2026-03-17 • by sleepwellinvestments

Original Post ↗SEC:
[All][10-K][10-Q]
Market Intel:
Yahoo Finance 📊TradingView 📈Koyfin 🎯

Thesis Summary

Trimming SPS Commerce (SPSC) due to high AI risk. Its data structure is deterministic, rule-based, and repetitive. Concerns about limited switching costs and network effects. Valuation is at its lowest since IPO, and they've implemented AI, but the data is the core issue.

Quantitative Overlay

Detailed Deep Dive

I need to cut one holding - SPS Commerce (this week) and monitor one closely. I’ll also add more to two (patiently).

I could be wrong, of course! Valuation is at its lowest since IPO, and this particular business has also implemented its own AI capabilities.

However,

Its data structure is the problem! Deterministic, rule-based, and repetitive. SaaS with the same data structure, and with limited switching costs and network effects advantages, is likely to suffer the same fate.

Let’s look at the details of why I am trimming before we report the portfolio performance.

Cutting SPS Commerce (SPSC)