Sprout Social downgraded to Neutral from Buy at Goldman Sachs

Goldman Sachs analyst Adam Hotchkiss downgraded Sprout Social (SPT) to Neutral from Buy with a price target of $44, down from $80. The firm had underestimated the near-term disruption risk to organic growth from the company’s re-orientation upmarket, adding that it had anticipated the move “would be a more immediate driver of incremental growth for the business. While the firm continues to be positive on Sprout’s ability to grow durably and take share upmarket longer-term, particularly given the company’s growing relationship with Salesforce (CRM) and challenges faced by competitors, Goldman believes there is added risk given the lack of visibility into pipeline conversion.