Citi cuts Atlassian target, opens ‘negative catalyst watch’

Citi lowered the firm’s price target on Atlassian to $265 from $280 and keeps a Buy rating on the shares. The analyst also opened a “30-day negative catalyst watch” on the shares. The company risks disappointing against current medium-term cloud growth and margin expectations, the analyst tells investors in a research note. The firm says Street cloud expectations appear optimistic, particularly as a guidance starting point, when contextualized against current below 30% organic cloud growth trends. Atlassian’s near-term seat expansion is unlikely to ameliorate if the “iffy” macro environment persists, and as server migration influence wanes, adds Citi.