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Investing.com - Barclays (LON:BARC) raised its price target on Pegasystems (NASDAQ:PEGA) to $58.00 from $50.00 while maintaining an Equalweight rating on the software company. The stock currently trades at $57.1, near its 52-week high of $56.84, after delivering an impressive 62% return over the past year. According to InvestingPro analysis, the stock appears to be trading above its Fair Value.
The price target increase follows Pegasystems’ second-quarter results, which exceeded consensus growth expectations. The company achieved robust revenue growth of 12.5% and maintains a strong gross margin of 75.5%. Barclays noted this marked the second consecutive quarter of above-consensus performance for the company.
The investment bank highlighted that the quality of Pegasystems’ Q2 beat was superior to Q1, with more upside coming from the PEGA cloud business rather than the Client Cloud segment that had benefited from large renewals in the previous quarter.
Barclays identified the company’s generative AI Blueprint offering as "starting to work well as a demand generation tool," which could drive future revenue and free cash flow success for the business.
Despite the positive developments and price target increase, Barclays maintained its Equalweight rating, citing ongoing work to evaluate Pegasystems’ total addressable market and the pending lawsuit with Appian (NASDAQ:APPN).
In other recent news, Pegasystems reported impressive second-quarter 2025 results, surpassing both earnings and revenue expectations. The company achieved an earnings per share of $0.28, exceeding the anticipated $0.24, which marked a 16.67% surprise. Revenue for the quarter reached $384.5 million, outpacing the expected $362.5 million by 6.07%. Notably, Pegasystems experienced a 9% year-over-year revenue growth, driven by a 24% increase in cloud revenue, which accounted for 43% of total revenue. Following these results, Rosenblatt raised its price target for Pegasystems from $59 to $61, maintaining a Buy rating. These developments reflect the company’s strong performance in the cloud sector, which has contributed significantly to its overall revenue growth.
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