Robert Oliver, an analyst from Robert W. Baird, maintained the Hold rating on PagerDuty (PD – Research Report). The associated price target is $25.00.
Geoff Meacham has given his Hold rating due to a combination of factors related to PagerDuty’s recent financial performance and market conditions. While PagerDuty’s third-quarter results showed some encouraging signs such as revenue and margin surpassing guidance, the company’s billing growth was not as strong as expected, only increasing by 4% year-over-year. Additionally, the customer base’s buying behaviors remain cautious, although there has been a noted stabilization in the enterprise and mid-market segments. The company has managed to expand its margins impressively, yet the forward-looking billings growth indicates potential challenges ahead.
The deceleration in billings growth to 10% for the fourth quarter signals a conservative outlook, leading to a belief that consensus estimates might decrease. Furthermore, the dollar-based net retention rate has seen a decrease, and there has been a slight decline in the number of paying customers year-over-year. Despite raising its full-year guidance for revenue and non-GAAP operating margin, and improving its non-GAAP EPS outlook, the tempered billing growth forecast for the next fiscal year suggests a need for caution. Hence, the Hold rating reflects the balance between PagerDuty’s solid margin performance and the headwinds from a challenging macroeconomic environment and slower-than-expected billing growth.
In another report released on December 1, TD Cowen also downgraded the stock to a Hold with a $23.00 price target.
PD’s price has also changed moderately for the past six months – from $27.750 to $21.730, which is a -21.69% drop .
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PagerDuty (PD) Company Description:
PagerDuty, Inc. operates a digital operations management platform. It provides incident management solution that integrates with information technology Ops and DevOps monitoring stacks to improve operational reliability and agility. The company was founded by Andrew Miklas, Baskar Puvanathasan, and Dan Alexandru Solomon in 2009 and is headquartered in San Francisco, CA.
Read More on PD:
- TD Cowen downgrades PagerDuty to Market Perform with macro pressures not easing
- PagerDuty downgraded to Market Perform from Outperform at TD Cowen
- PagerDuty price target lowered to $21 from $25 at Craig-Hallum
- PagerDuty Stock (NYSE:PD) Gained 6% as Q3 Results Beat Estimates
- PagerDuty sees FY24 EPS 72c-73c, consensus 64c
