Robert W. Baird analyst David Koning maintained a Hold rating on Thoughtworks Holding (TWKS – Research Report) on November 7 and set a price target of $5.00.
David Koning’s Hold rating on Thoughtworks Holding is primarily due to a variety of factors that shape the company’s current and future financial performance. Thoughtworks, despite being a strong franchise, is experiencing near-term pressures from the prevailing macroeconomic environment. The firm’s Q3 results surpassed Koning’s and the Street’s expectations, with revenue declining less than anticipated on a year-over-year basis. Management is also expecting to see revenue stability from Q4 into the first quarter of 2024, followed by modest sequential growth throughout the year. However, it’s important to note that the company’s clients are still exercising caution for 2024.
In addition to these factors, Koning’s rating also takes into account the company’s 2023 guidance. The firm’s 2023 revenue guidance was slightly lowered at the midpoint, primarily due to foreign exchange impacts, and EBITDA margin guidance was also reduced. However, EPS guidance was slightly increased. The company’s Q4 guidance for revenue, EBITDA and EPS is below the Street’s expectations at the midpoint. Koning also noted that sales cycles have remained elongated and work programs are being divided into smaller deals, which may impact the company’s future financial performance. Therefore, given these factors, Koning has given a Hold rating for Thoughtworks Holding.
According to TipRanks, Koning is a 4-star analyst with an average return of 2.1% and a 53.31% success rate. Koning covers the Technology sector, focusing on stocks such as Toast Inc, Accenture, and Verra Mobility.
In another report released on November 8, Citi also maintained a Hold rating on the stock with a $4.50 price target.
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Thoughtworks Holding (TWKS) Company Description:
Thoughtworks Holding Inc is a global technology consultancy that integrates strategy, design and software engineering to enable enterprises and technology disruptors across the globe to thrive as modern digital businesses.
Read More on TWKS:
- Thoughtworks price target lowered to $4.50 from $5 at Citi
- Thoughtworks raises FY23 EPS view to 12c-14c from 11c-13c, consensus 13c
- Thoughtworks sees Q4 adjusted EPS 2c-4c, consensus 4c
- Thoughtworks reports Q3 EPS 4c, consensus 3c
- Thoughtworks downgraded to Peer Perform from Outperform at Wolfe Research
