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On Friday, Evercore ISI adjusted its price target for Bill.com Holdings Inc. (NYSE: NYSE:BILL), reducing it to $50 from the previous $65, while maintaining an In Line rating for the company’s shares. The stock, currently trading at $47.57, has experienced significant pressure, declining nearly 38% over the past six months. According to InvestingPro analysis, the company appears undervalued based on its Fair Value metrics. The adjustment follows Bill.com’s third fiscal quarter report, which was mixed, and a cautious fourth fiscal quarter guidance that reflects the impact of broader economic conditions on the company’s primary small and medium-sized business (SMB) customer base.
Evercore ISI’s commentary noted that Bill.com’s reduced fourth-quarter revenue forecast is a direct result of changing fiscal and trade policies affecting SMB spending habits. Despite management’s previous optimistic outlook for the second half of the fiscal year, the firm expressed skepticism about the company’s visibility into its operations, given the softness observed in the SMB sector.
During the third-quarter earnings call, management indicated that SMBs are adapting to a changing macroeconomic landscape, with trends pointing to more conservative spending patterns, fewer transactions, and lower overall expenditure. These shifts have been factored into Bill.com’s near-term projections, leading to expectations of some pressure on transaction volumes and customer growth.
The report also highlighted that customers might be favoring lower-value payment methods like checks and ACH transfers over higher take-rate options. This preference raises questions about Bill.com’s strategy to ascend the market and its research and development investments designed to boost the overall take rate through new product offerings. Despite these challenges, InvestingPro data shows the company maintains impressive gross profit margins of 84.5% and holds more cash than debt on its balance sheet, suggesting financial resilience.
In conclusion, Evercore ISI suggests that while Bill.com has a long-term opportunity to dominate the financial back-office space for SMBs with its payment solutions, product expansion, and international growth, the current economic and political uncertainty may constrain the stock’s performance. Investors are advised to remain patient. The firm reiterated its In Line rating and set the new price target at $50. For deeper insights into Bill.com’s valuation and growth potential, InvestingPro subscribers can access comprehensive analysis, including 12 additional ProTips and detailed financial metrics in the Pro Research Report, helping investors make more informed decisions during these uncertain market conditions.
In other recent news, Bill.com reported its financial results for the third quarter of 2025, exceeding expectations with an earnings per share (EPS) of $0.50, surpassing the projected $0.37. The company also achieved a total revenue of $358 million, slightly above the anticipated $356.65 million. Despite these positive earnings results, the company’s stock fell by 3.51% in after-hours trading. Bill.com has been focusing on expanding its product offerings and enhancing its core services, contributing to an 11% year-over-year increase in total revenue. The company has launched advanced solutions for larger businesses and improved its international payment capabilities. For the fourth quarter of 2025, Bill.com anticipates total revenue between $370.5 million and $380.5 million, with core revenue expected to grow by 11-15%. The company projects a non-GAAP operating income of $43-$48 million. Analysts from Needham and Company have noted the company’s success with accountants adopting new solutions, suggesting potential for further cross-selling opportunities.
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