Top SaaS Stocks by Rule of 40 Score
Public SaaS companies ranked by their current Rule of 40 score. FCF and EBITDA methodologies surface different leaders: see why below, and which version matters for your valuation comp set.
Palantir Technologies (PLTR): 158% R40
96% YoY revenue growth (Q3 2026) plus 62% adjusted operating margin. Source: Palantir Q3 2026 results (SEC Form 8-K, 2 Nov 2026). On SaaSDB's FCF basis used in the main table below, Palantir scores 167.8 (rank 4), from a different growth input and FCF margin rather than adjusted operating margin.
Top 30 Public SaaS Companies by Rule of 40 (FCF Basis)
Revenue growth + FCF margin. Source: SaaSDB.app, read 2026-11-12.
| # | Company | Ticker | Rev Growth | FCF Margin | R40 Score | Source |
|---|---|---|---|---|---|---|
| 1 | Gloo Holdings, Inc. | GLOO | +489.4% | -59.7% | 429.7 | view ↗ |
| 2 | Applied Digital Corp. | APLD | +336.9% | -24.8% | 312.2 | view ↗ |
| 3 | CoreWeave, Inc. | CRWV | +277.6% | -100.3% | 177.3 | view ↗ |
| 4 | Palantir Technologies Inc. | PLTR | +146.5% | +21.3% | 167.8 | view ↗ |
| 5 | Reddit, Inc. | RDDT | +126.8% | +37.9% | 164.7 | view ↗ |
| 6 | Innodata Inc. | INOD | +99.7% | +14.3% | 114.0 | view ↗ |
| 7 | Exzeo Group, Inc. | XZO | +67.0% | +44.8% | 111.8 | view ↗ |
| 8 | Veeva Systems Inc. | VEEV | +24.2% | +83.5% | 107.7 | view ↗ |
| 9 | First Advantage Corp. | FA | +98.7% | +8.3% | 107.0 | view ↗ |
| 10 | Hinge Health, Inc. | HNGE | +76.3% | +24.8% | 101.1 | view ↗ |
| 11 | Figma, Inc. | FIG | +82.8% | +18.0% | 100.8 | view ↗ |
| 12 | Block, Inc. | XYZ | +44.8% | +54.8% | 99.5 | view ↗ |
| 13 | Duolingo, Inc. | DUOL | +56.6% | +31.3% | 87.8 | view ↗ |
| 14 | Roblox Corp | RBLX | +62.2% | +22.2% | 84.4 | view ↗ |
| 15 | Datadog, Inc. | DDOG | +56.9% | +21.6% | 78.5 | view ↗ |
| 16 | Varonis Systems, Inc. | VRNS | +25.5% | +49.9% | 75.4 | view ↗ |
| 17 | Clear Secure, Inc. | YOU | +36.6% | +38.5% | 75.2 | view ↗ |
| 18 | ServiceNow, Inc. | NOW | +39.0% | +32.4% | 71.4 | view ↗ |
| 19 | Rubrik, Inc. | RBRK | +66.3% | +4.0% | 70.3 | view ↗ |
| 20 | Clearwater Analytics Holdings, Inc. | CWAN | +62.7% | +6.7% | 69.4 | view ↗ |
| 21 | Dynatrace, Inc. | DT | +26.2% | +42.7% | 68.9 | view ↗ |
| 22 | Shopify Inc. | SHOP | +50.2% | +18.4% | 68.6 | view ↗ |
| 23 | Cloudflare, Inc. | NET | +60.5% | +8.0% | 68.5 | view ↗ |
| 24 | Bentley Systems, Inc. | BSY | +20.6% | +47.6% | 68.3 | view ↗ |
| 25 | Snowflake Inc. | SNOW | +46.0% | +19.8% | 65.8 | view ↗ |
| 26 | Qualys, Inc. | QLYS | +13.9% | +50.2% | 64.1 | view ↗ |
| 27 | N-able, Inc. | NABL | +56.2% | +7.4% | 63.6 | view ↗ |
| 28 | GitLab Inc. | GTLB | +35.8% | +27.0% | 62.8 | view ↗ |
| 29 | JFrog Ltd | FROG | +47.9% | +12.7% | 60.6 | view ↗ |
| 30 | Progress Software Corp. | PRGS | +32.3% | +28.1% | 60.4 | view ↗ |
Methodology notes & outlier caveats ↓
Gloo Holdings, Inc. (GLOO): Score rests on a 489.4% revenue-growth input alongside a -59.7% FCF margin; treat it as a data outlier rather than a like-for-like SaaS comp.
Applied Digital Corp. (APLD): Applied Digital builds and operates data centers, so it is not a pure SaaS business; the score rests on a 336.9% growth input.
CoreWeave, Inc. (CRWV): CoreWeave sells AI cloud infrastructure rather than SaaS; capex takes its FCF margin to -100.3% and the score rests on a 277.6% growth input.
Palantir Technologies Inc. (PLTR): SaaSDB's 146.5% growth input is higher than the 96% YoY growth Palantir itself reported for Q3 2026 (8-K, 2 Nov 2026); shown as SaaSDB publishes it. Palantir's own Rule of 40 is 158% (96% growth + 62% adjusted operating margin).
Block, Inc. (XYZ): SaaSDB lists Block under its former ticker SQ; Block now trades as XYZ. Some classify Block as fintech rather than SaaS.
ServiceNow, Inc. (NOW): Aventis Advisors scores ServiceNow 58.3 on its FCF basis (last-twelve-month financials, 5 May 2026); SaaSDB's figure uses a different period.
Clearwater Analytics Holdings, Inc. (CWAN): Aventis Advisors (LTM, 5 May 2026) ranks Clearwater first on both bases, 73.7 on EBITDA and 85.8 on FCF, and notes its growth was supported by acquisitions.
Aventis May 2026, n=55
Same sample, looser bar
SaaSDB, read 12 Nov 2026
4.8x vs 2.7x median
FCF vs EBITDA: why the leaderboards disagree
The Rule of 40 score depends entirely on which margin definition you use. The same company can land in completely different quartiles depending on the methodology.
FCF margin (free cash flow / revenue) captures cash generated after capital expenditure and changes in working capital. For SaaS, FCF margin is usually higher than EBITDA margin because:
- Stock-based compensation is added back (not a cash cost)
- Annual upfront billing creates a working-capital benefit (deferred revenue)
- Customer prepayments inflate cash receipts without affecting reported EBITDA
EBITDA margin uses operating earnings before interest, tax, depreciation, and amortisation. It does not add back SBC. For modern SaaS where stock-based comp regularly runs 15-25% of revenue, EBITDA margin is materially lower than FCF margin.
Which to use? Aventis Advisors May 2026 analysis shows the FCF-basis Rule of 40 has a stronger correlation with current public-market EV/Revenue multiples, suggesting investors are willing to "look through" SBC for now. For private M&A buyer-side comps (where SBC must be funded with real dilution), EBITDA-basis R40 is closer to economic reality. Both numbers matter; use the one that matches your buyer's decision frame.
The leaderboards above are sorted independently. Notice that the FCF top 5 (Gloo, Block, Applied Digital, Reddit, Palantir) barely overlaps with the EBITDA top 5 (Clearwater, Descartes, Adobe, Shopify, Intuit). Companies like CrowdStrike (CRWD) score 55.1 on FCF basis but ~22 on EBITDA basis because their GAAP EBITDA margin is essentially zero while FCF margin runs 33%. That gap is almost entirely stock-based compensation.
What Rule of 40 does not capture
A high Rule of 40 score is a necessary but not sufficient condition for premium valuation. Several factors not visible in the score materially shift outcomes:
- Net Revenue Retention (NRR). Two companies with the same R40 but NRR of 95% vs 130% trade at meaningfully different multiples. The 130% NRR company proves it can grow without new logo spend.
- Revenue concentration. A 50% growth rate built on five enterprise customers is structurally more fragile than the same growth diversified across hundreds of mid-market deals.
- Rule of 40 sustainability. A one-quarter spike from a large enterprise deal does not repeat. Investors discount any score not supported by 4-6 consecutive quarters of trend.
- AI disruption exposure. In 2026, sectors where AI agents can replace the SaaS workflow (support ticketing, basic CRM, generic analytics) are receiving lower multiples than the score alone would predict. Aventis flags this as the dominant valuation reset since early 2025.
- Stock-based comp burden. If SBC equals or exceeds FCF, the FCF margin is funded by shareholder dilution. Owner returns are correspondingly lower than the FCF margin suggests.