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Investing.com - Canaccord Genuity lowered its price target on Globant S.A. (NYSE:GLOB) to $97.00 from $165.00 on Thursday, while maintaining a Hold rating on the digital technology services company. The stock currently trades near its 52-week low of $86.02, having declined nearly 60% over the past six months. According to InvestingPro analysis, the company appears undervalued based on its Fair Value metrics.
The significant 41% reduction in price target comes amid what the research firm described as "macro uncertainty" that "warrants caution in the near term" for the Luxembourg-based company that specializes in digital and cognitive transformation services. Despite these challenges, Globant maintains a healthy revenue growth of 11.9% over the last twelve months, with a P/E ratio of 25.77.
Despite the substantial price target cut, Canaccord Genuity highlighted Globant’s platform, client base, and innovation pipeline as factors that continue to offer "long-term value creation potential" for investors. InvestingPro subscribers can access 7 additional key insights and a comprehensive Pro Research Report that provides deep-dive analysis of Globant’s financial health and growth prospects.
The research firm indicated that a potential reacceleration in Globant’s business, particularly in artificial intelligence initiatives and new client growth, would be necessary to justify a more positive outlook on the stock.
Globant, which provides services to clients across various industries including media and entertainment, professional services, technology, and telecommunications, has faced challenges as macroeconomic headwinds impact technology spending across multiple sectors.
In other recent news, Globant has announced the launch of its AI Pods, a subscription-based service model aimed at industries such as finance, retail, and media. This new offering is designed to provide scalable AI solutions with reduced costs and faster market delivery. Additionally, Globant has inaugurated its Middle East Regional Headquarters in Riyadh, Saudi Arabia, marking a significant expansion in the region. The new headquarters will focus on delivering advanced AI solutions and fostering local IT talent.
In financial updates, Globant’s revenue in the Middle East & APAC surged by 84.4% year-over-year in the first quarter of 2025. However, analysts have adjusted their price targets for Globant shares. Jefferies reduced its price target to $125 while maintaining a Buy rating, highlighting the company’s potential for recovery and growth. Similarly, TD Cowen cut its price target to $125 but also kept a Buy rating, noting that current challenges are seen as cyclical.
Mizuho (NYSE:MFG) Securities lowered its price target to $153 and maintained an Outperform rating, following Globant’s revision of its full-year revenue growth guidance. Despite the revised forecasts, analysts from these firms express confidence in Globant’s long-term prospects. These developments reflect the company’s ongoing efforts to navigate economic challenges while expanding its global presence.
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