Piper Sandler analyst Brent Bracelin upgraded the rating on BlackLine (BL – Research Report) to a Hold yesterday, setting a price target of $62.00.
Brent Bracelin has given his Hold rating due to a combination of factors including the evaluation of BlackLine’s current market position and future prospects. Bracelin acknowledges the limited downside risks to BlackLine’s valuation, given the stock’s performance relative to the market and recent guidance revisions that have set conservative growth expectations for the company. He notes that the stock’s year-to-date sell-off and the adjustments to revenue growth estimates suggest that potential negative impacts from macroeconomic headwinds are likely already reflected in the current stock price.
Furthermore, Bracelin points out the accelerating growth in SAP’s cloud backlog, which could translate into a tailwind for BlackLine in the future, considering the significant portion of sales driven by their SAP partnership. The upcoming end of maintenance for SAP’s ERP Central Component is also highlighted as a potential catalyst for increased migrations to S/4HANA, which could benefit BlackLine in the 2025-2026 period. Healthy enterprise activity, as evidenced by job postings for positions requiring BlackLine experience, further supports the company’s strong positioning in the market. Despite these positive indicators, Bracelin maintains a cautious stance for 2024 while slightly increasing estimates for 2025, leading to the Hold rating and an updated price target.
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BlackLine (BL) Company Description:
BlackLine, Inc. operates a cloud-based software platform which is designed to transform accounting and finance operations for organizations of all types and sizes. Its scalable platform supports critical accounting processes such as the financial close, account reconciliations, intercompany accounting, and controls assurance. The company was founded by Therese Tucker in May 2001 and is headquartered in Woodland Hills, CA.
