Model N downgraded to Neutral from Buy at BTIG

BTIG downgraded Model N to Neutral from Buy without a price target. The company reported fiscal Q4 results that were mostly better than expected, but offered a muted outlook for subscription revenue growth as it resets the growth outlook into the end of a software-as-a-service transition, the analyst tells investors in a research note. The firm says Model N’s prospects for near-term reacceleration of sales results “have evaporated” as the up-sell/cross-sell motion is materializing more slowly than previously anticipated. With this slowdown, BTIG expects margin expansion and free cash flow generation to improve more slowly than before as the operating leverage from growth is less substantial.