BlackLine stock rating initiated at Buy by Rosenblatt with $65 target

Investing.com - Rosenblatt Securities initiated coverage on BlackLine (NASDAQ:BL) with a Buy rating and a $65.00 price target on Tuesday. The financial software provider currently trades at $56.09 with a market cap of $3.34 billion, suggesting potential upside from Rosenblatt’s target. InvestingPro data shows the stock is currently trading below its Fair Value.

The financial software provider, which specializes in solutions for the Office of the CFO, is positioned to deliver accelerating growth while expanding margins significantly in the coming years, according to Rosenblatt. The company has demonstrated revenue growth of 7.36% over the last twelve months, with total revenue reaching $686.71 million.

The firm cited BlackLine’s re-architected platform as a key factor improving its competitive positioning in the market, alongside the company’s rollout of a new pricing model designed to better align monetization with value.

Rosenblatt also pointed to BlackLine’s improving go-to-market strategy as contributing to what it expects will be an enhanced financial profile for the company.

The firm noted that BlackLine’s current valuation sits below comparable companies amid low investor expectations, suggesting significant upside potential for the stock at current levels.

In other recent news, BlackLine has been in the spotlight due to several developments. Engaged Capital has demanded access to BlackLine’s records concerning acquisition offers, notably a reported $66 per share bid from SAP SE. This move follows Engaged Capital’s interest in understanding how BlackLine handles acquisition interest. Additionally, BlackLine has maintained an independent strategic committee for over a year, with David Henshall, Greg Hughes, and Tom Unterman as its current members, as disclosed in a recent SEC filing.

On the analyst front, Citizens has reiterated its Market Outperform rating with an $80 price target for BlackLine, despite the company’s shares falling 10% year-to-date. Meanwhile, DA Davidson has assumed coverage with a Neutral rating and a $56 price target, citing third-quarter results that met consensus expectations. In contrast, Baird downgraded BlackLine from Outperform to Neutral, lowering the price target to $55 due to concerns over the company’s pricing model and unexpected customer churn in the third quarter. These recent developments highlight the diverse perspectives and ongoing interest in BlackLine’s strategic and financial trajectory.

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