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On Wednesday, B. Riley analysts upgraded Yext Inc . (NYSE: NYSE:YEXT) stock from Neutral to Buy. The analysts also raised the price target to $10.00 from $7.00, above the current trading price of $6.82. According to InvestingPro data, analyst consensus remains mixed with targets ranging from $7.00 to $10.00. This decision comes following a quarter-over-quarter improvement in key performance indicators such as retention and annual recurring revenue.
The analysts highlighted Yext’s management track record, noting significant EBITDA margin expansion over the past two years and successful mergers and acquisitions. These factors contributed to the upgrade, indicating confidence in the company’s financial management and future growth potential.
Additionally, the analysts pointed to early positive signs for Yext’s new product, Scout, which is currently in closed beta. This development is expected to enhance retention and annual recurring revenue growth when fully launched.
The report also mentions Yext’s potential for additional strategic acquisitions, which could further enhance the company’s financials. The company’s disciplined approach to mergers and acquisitions is seen as a positive factor in this regard.
Yext’s current trading at 7.3 times forward EBITDA and an active share repurchase program, with over 4% of shares outstanding repurchased year-to-date, were also noted as factors making the stock an attractive risk/reward proposition.
In other recent news, Yext Inc. reported its Q1 Fiscal 2026 earnings, meeting the earnings per share (EPS) forecast of $0.12 and surpassing revenue expectations with $109.5 million, compared to the forecast of $107.6 million. The company launched Yext Scout, an AI-powered product currently in open beta, and continues its share buyback program, which has reduced the overall share count. Yext’s performance showed improvements in gross and net retention rates, benefiting from favorable foreign exchange rates. The ongoing share buyback program and a new debt facility from BlackRock (NYSE:BLK) provide flexibility for future investments, including potential mergers and acquisitions. CEO Michael Walrath noted improvements in customer satisfaction and value perception across Yext’s platform. The company remains cautious due to macroeconomic uncertainties but is optimistic about shorter sales cycles with Yext Scout. Analysts from firms like B. Riley Securities and Needham and Company showed interest in the company’s strategic initiatives and growth potential.
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