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Canaccord Genuity lowered its price target on GitLab Inc (NASDAQ:GTLB) to $76.00 from $78.00 on Thursday, while maintaining a Buy rating on the software development platform provider. The stock, currently trading at $43.37, shows potential upside according to InvestingPro analysis, with 14 analysts recently revising their earnings expectations upward.
The firm cited a valuation adjustment as the primary reason for the price target reduction, shifting to approximately 10.5x C26E EV/Rev from the previous ~13x CY25E multiple, which it considers appropriate for GitLab’s growth and margin profile. The company maintains impressive gross profit margins of 88.6% and has demonstrated solid revenue growth of 29.3% over the last twelve months.
Canaccord emphasized that GitLab continues to demonstrate strong revenue growth from seat expansions despite the current software buying environment, which the firm views as evidence that the platform’s value proposition resonates with customers. Get deeper insights into GitLab’s growth metrics and 12 additional exclusive tips with an InvestingPro subscription.
The research firm noted that investing in the software supply chain remains a top priority for IT buyers, highlighting GitLab’s unique end-to-end platform approach that begins with source code management.
Canaccord also pointed to GitLab’s achievement of profitability, expressing expectations that operating leverage will naturally emerge as the company scales further into what it describes as a large software deployment market.
In other recent news, GitLab Inc reported its first-quarter results, showing a 27% revenue growth, which UBS described as strong, though the revenue beat was the smallest in the company’s history. Despite this, GitLab maintained its fiscal year 2026 revenue guidance. Macquarie noted a modest $1.5 million revenue beat and highlighted GitLab’s strong remaining performance obligation growth. GitLab also expanded its non-GAAP operating margin by 14 percentage points year-over-year, exceeding earnings per share expectations.
Several analyst firms adjusted their price targets for GitLab following the quarterly results. Macquarie lowered its price target to $75, while UBS reduced it to $73, maintaining a Buy rating. DA Davidson reiterated a Neutral rating with a $45 price target, citing timing issues affecting performance. TD Cowen decreased its price target to $67, maintaining a Buy rating and describing the recent sell-off as an overreaction. RBC Capital also lowered its price target to $62, maintaining an Outperform rating and noting no surprises in the quarter. Despite mixed results, GitLab’s management remains optimistic about the company’s growth drivers and maintained its revenue guidance for fiscal year 2026.
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