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Stock Analysis & Ideas

Lightspeed Stock Plunges, Analysts Remain Bullish

Story Highlights

While Lightspeed stock has corrected more than 80%, Wall Street is bullish about the ongoing momentum in its business and solid growth outlook.

Shares of the omnichannel commerce-enabling company Lightspeed (TSE:LSPD) (NYSE:LSPD) are down over 80% from its 52-week high. A short report from Spruce Point, the weakening of the macro environment, and tough comparisons are why LSPD has lost such significant value. While LSPD stock has witnessed a sharp pullback, Wall Street analysts maintain a bullish view. 

Analysts Maintain a Bullish Stance 

LSPD stock has received 12 Buy, one Hold, and one Sell recommendations for a Strong Buy rating consensus. Meanwhile, the average Lightspeed price target of C$49.46 implies 97.4% upside potential to current levels.

Analysts’ bullish view is centered around LSPD’s ability to deliver strong growth despite macro challenges. Furthermore, the ongoing momentum in its business and its solid outlook keep analysts upbeat. 

Piper Sandler analyst Clarke Jeffries, who is bullish on LSPD, raised his price target to $40 (105.3% upside potential) from $39, citing its solid FY23 guidance. Lightspeed expects its top line to increase by 35-40% in FY23, which is in line with its organic growth target. 

The strong demand for its offerings, new product launches, and expansion of its payment solutions will likely support its growth. 

Echoing similar sentiments, BTIG’s Mark Palmer stated that LSPD’s FY23 guidance reflects that the demand for its e-commerce and POS (point of sale) offerings will remain high regardless of the macro challenges. 

Palmer maintains a Buy recommendation on LSPD stock, and his price target of C$78.01 implies 211.3% upside potential. 

Bottom Line 

While macro headwinds continue to limit the recovery in LSPD stock, it continues to benefit from investments in digital transformation. Further, its growing payments penetration and higher revenue per user are positives. Moreover, its focus on opportunistic acquisitions and customer growth provide a solid foundation for growth.

Disclosure 

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