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On Thursday, US Tiger Securities updated its stance on Bill.com Holdings Inc. (NYSE: NYSE:BILL), raising its price target to $25.00, up from the previous $18.00. The firm reaffirmed its Buy rating on the stock. This adjustment follows Bill.com's reported third-quarter results, which surpassed consensus expectations and marked the company's first instance of non-GAAP profitability.
The financial technology company, known for automating complex back-office financial operations, has demonstrated significant growth in its daily and monthly active users. The third quarter saw daily active users (DAU) increase by 4% year-over-year to 107.3 million, a slight deceleration from the 6% growth observed in the second quarter. Monthly active users (MAU) rose by 2% year-over-year to 348.0 million, compared to a 4% increase in the previous quarter, maintaining a stable DAU/MAU ratio of 31%.
Engagement with Bill.com's platform also showed positive trends. The average daily time spent by users on the platform during the third quarter was 106 minutes, marking a 6% year-over-year increase. The company also experienced a 23% surge in average total daily video views, reaching 5.8 billion, which is higher than the 17% increase seen in the second quarter. Moreover, average monthly interactions climbed by 14% year-over-year to 19.3 billion.
The analyst from US Tiger Securities expressed confidence in maintaining the Buy rating while increasing the price target. The analyst cited the robust third-quarter results and the company's milestone achievement of non-GAAP profitability as the primary reasons for the optimistic outlook on the stock.
In other recent news, Bill.com reported impressive financial results for the first fiscal quarter. The company's revenues reached $358 million, surpassing the consensus estimate of $348 million and marking a 19% year-over-year core revenue increase. Bill.com's management has revised its revenue growth forecast for fiscal year 2025, now expecting a 12-13% increase year-over-year, up from the previously projected 10-12%. This adjustment reflects strong trends observed in the first quarter and adds approximately $19 million to the guidance range.
Mizuho (NYSE:MFG) Securities has reacted to these developments by increasing its price target for Bill.com from $52 to $64, while maintaining a Neutral rating on the stock. The firm has acknowledged the company's potential for growth but maintains a cautious outlook on its current valuation and future performance. Bill.com has also repurchased 3.7 million shares worth $200 million as part of a $300 million authorization, a move seen as positive by Mizuho.
Furthermore, Bill.com's platform now serves over 475,000 businesses, handling $80 billion in payment volume. The company added over 1,000 accounting firms to their platform, bringing the total to more than 8,500 partners. These recent developments are indicative of the company's confidence in its growth trajectory and market leadership.
InvestingPro Insights
Building on Bill.com's impressive third-quarter results and US Tiger Securities' optimistic outlook, recent InvestingPro data provides additional context for investors. The company's market capitalization stands at $9.09 billion, reflecting its significant presence in the fintech sector. Bill.com's revenue growth remains strong, with a 18.54% increase over the last twelve months, aligning with the user growth and engagement metrics highlighted in the article.
InvestingPro Tips suggest that Bill.com holds more cash than debt on its balance sheet, which could provide financial flexibility as the company continues to grow. Additionally, the company boasts impressive gross profit margins, reported at 85.24% for the last twelve months, underscoring its efficient business model in automating financial operations.
It's worth noting that Bill.com's stock has seen a significant return of 60.35% over the last month and is trading near its 52-week high, with the price at 96.19% of its peak. This recent performance aligns with the positive sentiment expressed in the analyst's upgraded price target.
For investors seeking a more comprehensive analysis, InvestingPro offers 18 additional tips for Bill.com, providing deeper insights into the company's financial health and market position.
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