It would be easy to declare that things are about to get bad for Bill.com Holdings (NYSE:BILL). After all, offering cloud-based software to small and medium-sized businesses in an environment where such businesses are about to take a royal pounding would seem bad for business. However, Bill.com was up a little over 3.5% in Friday’s trading thanks to one simple notion: it won’t be that bad.
Who holds such an opinion? It’s none other than UBS, who noted, via analyst Taylor McGinnis, that most of the potential negatives against Bill.com are already factored in. At least, they are as far as most investors are concerned. McGinnis also noted that Bill.com was trading at about “a turn discount to peers with similar revs growth,” which puts it around the rest of the field.
A Simply Wall St. report noted something similar. Bill.com’s price-to-sales ratio is wildly out of line when it comes to others in the Software sector. However, much of that comes with solid revenue growth and an expectation that it will continue. Given that further word from UBS also suggests that Bill.com can hike its current revenue figures—at least, in subscription and transaction—by an extra 45%, such an assertion isn’t out of line. Bill.com has already shown impressive growth. While past performance isn’t an indicator of future performance, it’s a decent guide.
Analysts are strongly on Bill.com’s side as well. With 14 Buy ratings and seven Holds, BILL stock stands as a Moderate Buy by analyst consensus. Further, with an average price target of $124.42, it boasts 56.68% upside potential.
