DA Davidson maintains Alight stock Buy rating, $10 target

On Monday, DA Davidson reaffirmed its Buy rating and price target of $10.00 on shares of Alight Solutions (NYSE:ALIT), representing a significant upside from the current price of $5.79. Analyst Peter Heckmann provided positive remarks on the company’s performance, noting that Alight’s first-quarter results surpassed DA Davidson’s expectations in terms of total revenue and adjusted EBITDA by 2% and 3%, respectively. According to InvestingPro data, analyst targets for ALIT range from $8 to $11.

Heckmann highlighted that following the announcement of the first-quarter results, Alight Solutions’ management has confirmed their guidance for the year 2025 and conveyed a strong sense of confidence regarding the company’s future prospects. In light of the recent financial update, DA Davidson has made slight adjustments to its forecasts for Alight; however, these revisions are not significant enough to impact the annual projections.

The analyst’s affirmation of the Buy rating and the $10 price target comes after a thorough review of Alight’s quarterly performance and the company’s steadfast outlook for the coming years. Alight’s latest financial disclosures appear to align with DA Davidson’s positive sentiment towards the company’s stock.

Alight Solutions, which trades on the New York Stock Exchange under the ticker ALIT, specializes in providing cloud-based human capital solutions. The company’s recent financial results and the subsequent vote of confidence from DA Davidson suggest a stable outlook for the firm in the eyes of the analyst firm.

In other recent news, Alight Inc. reported its first-quarter 2025 earnings, meeting expectations with an earnings per share (EPS) of $0.10 and slightly surpassing revenue forecasts with $548 million. The company’s revenue exceeded expectations by $6.5 million, showcasing its financial stability, largely attributed to its high recurring revenue base. Alight’s adjusted EBITDA for the quarter was $118 million, which was at the high end of the guidance range, while its free cash flow stood at $44 million. The company reaffirmed its full-year 2025 financial outlook, projecting revenue between $2.32 billion and $2.39 billion, along with adjusted EBITDA of $605 million to $645 million.

Alight’s CEO, Dave Gilmette, emphasized the strength of the company’s integrated Work Life platform and its focus on innovation, which includes a new self-service leaves administration platform. CFO Jeremy Heaton highlighted the benefits of Alight’s recurring revenue base tied to long-term contracts. The company’s financial performance reflects a cautious market outlook due to volatility and employment concerns, though it maintains a strong pipeline with a 30% increase. Alight’s focus remains on innovation and cost reduction for clients, even as it navigates current market conditions.

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