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Klaviyo (NYSE:KVYO) added 6.5% during premarket trading Monday as Goldman Sachs upgraded the Boston-based, automated marketing company.
Despite underperforming by 22% over the past three months, and more volatility likely in the two to three months ahead, Goldman Sachs analyst Gabriela Borges expects the company to have higher thresholds for email marketing deliverability. This should result in stock outperformance over a 12-month period.
In addition to the upgrade, Goldman also set its 12-month price target at $36.
Google (GOOG) and Yahoo are enforcing new rules for mass email senders beginning this month. These allow email users to more easily unsubscribe and keep spam out of the inbox.
Concerns over disruptions to Klaviyo's business by these spam filtering upgrades are "overdone," according to Goldman Sachs.
Klaviyo's next quarterly earnings report is slated for Feb. 27. Analysts expect the company to earn $0.08 per share and $196.13M in revenue.
Analysts appear bullish on Klaviyo. It has a BUY rating from both Seeking Alpha authors and Wall Street analysts. It is not covered by Seeking Alpha's quant system.