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On Wednesday, BTIG analyst Andrew Harte initiated coverage on Bill.com Holdings Inc. (NYSE: NYSE:BILL), issuing a Buy rating and setting a price target of $60.00. Harte highlighted Bill.com’s leading position in the small and medium-sized business (SMB) Accounts Payable (AP) software and payments market, underscoring the company’s potential to increase prices in the coming years to boost growth from approximately 16% in the most recent quarter to an estimated 20% in fiscal year 2026. According to InvestingPro data, the company’s current revenue growth stands at 16.42%, with impressive gross margins of 85.05%, suggesting room for price increases while maintaining competitiveness.
Bill.com’s platform has been recognized for providing significant value to SMBs at a cost-effective rate, which contributes to its high customer retention rates. Harte pointed out that the platform’s "stickiness" is a key factor that should allow the company to implement price increases. Moreover, he noted the vast business-to-business (B2B) payments Total (EPA:TTEF) Addressable Market (TAM) that Bill.com is targeting, which could ensure continued double-digit growth as businesses transition from paper-based to automated AP solutions. InvestingPro analysis suggests the stock is currently undervalued, with 13 additional exclusive insights available to subscribers.
Despite the stock’s volatility, which Harte attributed to the macroeconomic exposure of Bill.com’s SMB customers and the ongoing evaluation of the company’s ability to expand its take-rate through ad valorem payments adoption, he remains optimistic. According to Harte, the current market valuation already reflects macro concerns, with InvestingPro data confirming a 45.25% year-to-date decline. The stock currently trades at $46.38, with analyst targets ranging from $43 to $120, suggesting significant potential upside. Furthermore, he expressed confidence in the management’s commitment to increasing ad valorem payments adoption.
Harte also mentioned that approximately 1% of U.S. GDP is processed through Bill.com’s platform, indicating significant room for growth. He concluded by emphasizing the company’s potential to introduce additional products to further support SMBs, leveraging its scale and the value it provides to customers. With a market capitalization of $4.7 billion and strong financial health metrics according to InvestingPro, the company appears well-positioned to execute on its growth strategy.
In other recent news, Bill.com Holdings Inc. has integrated new procurement features into its platform, enhancing its capabilities in accounts payable, accounts receivable, and cash flow management. This update aims to streamline procure-to-pay workflows using artificial intelligence, offering users improved financial visibility and fraud prevention. Meanwhile, KeyBanc Capital Markets has adjusted its price target for Bill.com from $85 to $70, maintaining an Overweight rating. This revision reflects a cautious outlook on small and medium-sized business spending and a broader contraction in peer group valuation multiples. Similarly, BMO Capital Markets has reduced its price target to $78 from $98, citing the company’s recent financial results, which showed the smallest revenue beat since its IPO. Despite these challenges, Needham has reaffirmed its Buy rating and $100 price target, highlighting the company’s strategic efforts to deepen engagement within the accounting sector and expand cross-selling opportunities. The company’s management remains optimistic about future growth, particularly with the integration of the Spend & Expense solution.
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