Craig-Hallum says ‘got LivePerson wrong,’ downgrades to Hold

As previously reported, Craig-Hallum analyst Jeff Van Rhee downgraded LivePerson to Hold from Buy with a price target of $6, down from $15, saying the firm "flat out got LPSN wrong." Craig-Hallum notes that it had been early to lower its revenue numbers and came into the quarter cautious on revenue, but bullish on the EBITDA run rate it expected exiting Q4. Instead, the firm "got a much deeper revenue cut and expenses as expected," yielding much lower EBITDA in 2023 than expected. Deal sizes and new bookings were softer than expected as well, Craig-Hallum notes. With less organic growth, less EBITDA and a softening bookings and macro, the firm says that it needs "to be intellectually honest about our recent, misguided upgrade to Buy and the fact that our thesis is no longer valid."