Analyst Derrick Wood from TD Cowen maintained a Buy rating on Braze and decreased the price target to $38.00 from $47.00.
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Derrick Wood’s rating is based on several key factors that suggest potential for Braze’s stock. Despite a softer first quarter, Braze’s sales headcount data and positive insights from peers like KVYO and TWLO indicate a stable demand environment. The company’s valuation remains attractive at approximately 4x EV/CY26E Sales, especially against its mid to upper teens organic growth forecast.
Additionally, the acquisition of OfferFit is expected to enhance Braze’s technology and cross-selling opportunities, although it may initially pressure margins. The appointment of a new Chief Revenue Officer and the adoption of flexible credits pricing have shown promising results, with shorter negotiation times and increased interest in multi-channel engagements. While macroeconomic factors continue to impact legacy re-platforming activities, the overall outlook for the second quarter is stable, with expected revenue growth in line with market expectations. Therefore, Wood maintains a Buy rating, albeit with a slightly reduced price target of $38 due to valuation pressures in the SaaS sector.
Wood covers the Technology sector, focusing on stocks such as Oracle, Gitlab, and Samsara. According to TipRanks, Wood has an average return of 9.6% and a 54.23% success rate on recommended stocks.
In another report released on August 29, Cantor Fitzgerald also maintained a Buy rating on the stock with a $35.00 price target.