Sprout Social (SPT) AI Stock Analysis

• Market Cap: $739.22M
• Dividend Yield: N/A
• Average Volume (3M): 1.17M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.38
• Revenue Growth: 14.79%
• EPS Growth: 27.52%
• Country: US
• Employees: 1,322
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.18
• Shares Outstanding: 52,645,844
• 10 Day Avg. Volume: 1,434,213
• 30 Day Avg. Volume: 1,166,379
• PEG Ratio: 3.36
• Price to Book (P/B): 10.50
• Price to Sales (P/S): 4.31
• P/FCF Ratio: 74.82
• Enterprise Value/Market Cap: 1.55
• Enterprise Value/Revenue: 2.66
• Enterprise Value/Gross Profit: 3.43
• Enterprise Value/Ebitda: -28.01
• 1Y Price Target: $23.00
• Price Target Upside: 84.44% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 61 Neutral
• Price Target: $13.00 ▲(4.25% Upside)

Sprout Social's overall score is driven by strong earnings call performance and improving cash flow metrics, despite technical and valuation challenges. The company's strategic focus on high-value customers and AI integration supports future growth, but profitability remains a key concern.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term expansion and stability.

Strategic Acquisitions

The acquisition of NewsWhip enhances Sprout Social's AI capabilities, potentially improving product offerings and competitive positioning.

Integration with Canva

The integration with Canva strengthens Sprout Social's platform by improving user experience and workflow efficiency, enhancing customer value.

Negative Factors

Profitability Challenges

Ongoing net losses and negative profit margins highlight operational challenges, potentially limiting financial flexibility and growth investments.

Leadership Changes

The resignation of the Chief Revenue Officer may disrupt strategic execution and revenue growth initiatives, affecting long-term performance.

Macroeconomic Challenges

Macroeconomic pressures could impact demand for Sprout Social's services, affecting revenue growth and market expansion efforts.

Sprout Social Business Overview & Revenue Model

Company Description

Sprout Social, Inc. designs, develops, and operates a web-based social media management platform in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It provides cloud software that brings together social messaging, data, and workflows in a unified system of record, intelligence, and action. The company offers provides various integrated tools in a range of functions comprising social engagement/response, publishing, reporting and analytics, social listening and business intelligence, reputation management, employee advocacy, and automation and workflows. Its tools serve a range of use-cases within its customers' organizations, including social and community management, public relations, marketing, customer service and care, commerce, sales and customer acquisition, recruiting and hiring, product development, and business strategy. The company also offers professional services, which primarily consist of consulting and training services. It serves approximately more than 31,000 customers across small-and-medium-sized businesses, mid-market companies, enterprises, marketing agencies, government, non-profit, and educational institutions. The company was incorporated in 2010 and is headquartered in Chicago, Illinois.

How the Company Makes Money

Sprout Social generates revenue primarily through a subscription-based model, offering tiered pricing plans for its software services. These plans cater to businesses of different sizes, from small startups to large enterprises, allowing customers to choose features that align with their specific needs. Key revenue streams include monthly or annual subscriptions, add-on features, and professional services such as training and support. The company also benefits from partnerships with social media platforms and integrations with other marketing tools, which enhance its service offerings and create additional value for customers, further contributing to its earnings.

Sprout Social Financial Statement Overview

Summary

Sprout Social shows strong revenue growth and a solid balance sheet with low leverage. However, persistent profitability challenges and net losses are concerning. The improving cash flow position is a positive sign, but sustained improvement in profitability is necessary for long-term financial health.

Income Statement

Sprout Social has shown commendable revenue growth, increasing from $132.95M in 2020 to $418.41M in TTM. The gross profit margin remains robust at 77.55% for TTM, which is strong for the software industry. However, consistent net losses, with a net profit margin of -14.24% in TTM, and negative EBIT and EBITDA margins indicate ongoing profitability challenges.

Balance Sheet

The company maintains a solid equity base with a debt-to-equity ratio of 0.10 in TTM, reflecting low leverage. The equity ratio is strong at 41.27%, indicating a stable capital structure. However, ongoing net losses could pressure equity if not addressed.

Cash Flow

Sprout Social's cash flow is improving with a positive operating cash flow of $33.26M in TTM, and free cash flow has grown significantly. The operating cash flow to net income ratio is positive, indicating healthy cash generation relative to net losses. However, sustaining cash flow growth is crucial to offset persistent net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	430.80M	405.91M	333.64M	253.83M	187.86M	132.95M
Gross Profit	334.38M	314.43M	257.38M	193.97M	141.07M	98.03M
EBITDA	-40.90M	-45.91M	-54.79M	-44.79M	-23.48M	-25.88M
Net Income	-54.71M	-61.97M	-66.43M	-50.24M	-28.70M	-31.66M
Balance Sheet
Total Assets	422.93M	428.34M	396.58M	293.92M	264.72M	239.67M
Cash, Cash Equivalents and Short-Term Investments	101.53M	90.18M	94.41M	172.85M	176.94M	163.88M
Total Debt	30.90M	43.29M	74.03M	21.79M	23.64M	25.79M
Total Liabilities	238.38M	261.75M	252.39M	151.58M	119.51M	87.57M
Stockholders Equity	184.56M	166.59M	144.19M	142.34M	145.21M	152.10M
Cash Flow
Free Cash Flow	34.02M	23.37M	4.38M	8.84M	13.89M	-15.37M
Operating Cash Flow	36.29M	26.32M	6.46M	10.67M	14.82M	-11.35M
Investing Cash Flow	8.82M	40.73M	-86.64M	-37.67M	-22.12M	-53.80M
Financing Cash Flow	-24.38M	-30.32M	53.96M	-193.00K	-100.00K	44.36M

Sprout Social Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 12.47
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPT, the sentiment is Negative. The current price of 12.47 is below the 20-day moving average (MA) of 14.08, below the 50-day MA of 15.08, and below the 200-day MA of 22.60, indicating a bearish trend. The MACD of -0.65 indicates Positive momentum. The RSI at 31.82 is Neutral, neither overbought nor oversold. The STOCH value of 8.08 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPT.

Sprout Social Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CXM	70 Neutral	$1.89B	17.15	22.11%	―	6.08%	153.79%
SPT	61 Neutral	$739.22M	―	-32.50%	―	14.79%	27.52%
DSP	59 Neutral	$527.53M	249.40	8.57%	―	30.92%	―
DOMO	53 Neutral	$641.15M	-7.89	40.43%	―	>-0.01%	9.72%
RSKD	50 Neutral	$738.70M	-19.51	-11.61%	―	7.96%	5.67%
BMBL	49 Neutral	$627.18M	-0.82	-147.04%	―	-5.06%	-2318.18%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Sprout Social Corporate Events

Sprout Social’s CRO Resignation Amid Stable Outlook

On September 4, 2025, Sprout Social announced the resignation of Mike Wolff, the Chief Revenue Officer, who is leaving to join a strategic partner. Despite this leadership change, the company reaffirmed its third quarter and full year 2025 financial guidance, indicating stability in its financial outlook and operations.

Sprout Social Releases Shareholder Letter on Strategy

On August 26, 2025, Sprout Social, Inc. released a shareholder letter authored by co-founder Aaron Rankin, which was made available as part of a Current Report on Form 8-K. The letter, while not filed under the Securities Exchange Act of 1934 or the Securities Act of 1933, offers insights into the company’s current operations and strategic direction.

Sprout Social Releases New Investor Presentation

On August 6, 2025, Sprout Social posted an investor presentation on its website, which will be used in discussions with investors and analysts. The presentation contains forward-looking statements and is part of the company’s ongoing communication strategy, but the company does not commit to updating the information publicly.

Sprout Social Acquires NewsWhip for $55 Million

On July 30, 2025, Sprout Social, Inc. completed the acquisition of NewsWhip Group Holdings Limited, an AI-powered media intelligence platform based in Dublin, Ireland. The acquisition, valued at $55 million with potential additional payments, was funded through cash and credit facilities, and is expected to enhance Sprout Social’s capabilities in media intelligence.