Planet Labs PBC (NYSE:PL) provides daily data and insights about Earth through its satellite imagery systems. PL stock has lost about 50% of its value year-to-date. However, analysts love this penny stock (learn more about penny stocks here) and maintain a bullish outlook.
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Factors Keeping Analysts Bullish
Planet Labs stock faced challenges due to prolonged sales cycles, compounded by macroeconomic headwinds in the commercial segment and challenging year-over-year comparisons. Additionally, the company’s shift towards government contracts extended its sales cycles.
Nevertheless, Planet Labs is likely to benefit from the large, addressable market. Moreover, its growing customer base, annual and multi-year contracts, and high net dollar retention rate are positives. Further, its robust backlog of remaining performance obligations signals an anticipated increase in future revenue. Moreover, lucrative contracts with government clients bode well for growth. Additionally, the company’s focus on maintaining a healthy balance sheet, generating cash, managing dilution, and enhancing shareholders’ value supports its bull case.
Further, the significant correction in its share price makes PL attractive on the valuation front. Echoing similar sentiments, Goldman Sachs analyst Noah Paponak reiterated a Buy rating on Planet Labs stock on December 7. Citing a re-acceleration in organic revenue, expectation of positive EBITDA, a strong balance sheet, and valuation, the analyst maintained a bullish outlook on PL stock.
What is the Price Target for Planet Labs?
With six Buy and one Hold recommendations, Planet Labs stock has a Strong Buy consensus rating. Meanwhile, the average PL stock price target of $4.92 suggests 116.74% upside potential from current levels.
Bottom Line
Planet Labs has significant upside potential based on analysts’ consensus price target. While the stock offers notable upside potential, investors can use TipRanks’ penny stock screener to find more such attractive penny stocks.
