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RBC Capital lowered its price target on GitLab Inc (NASDAQ:GTLB) stock to $62.00 from $68.00 on Wednesday, while maintaining an Outperform rating on the software development platform. The stock, currently trading at $43.72, maintains strong fundamentals with an impressive 88.79% gross profit margin and 30.93% year-over-year revenue growth.
The price target adjustment follows GitLab’s quarterly results that exceeded guidance, though RBC noted the revenue beat was lower than expected. Despite the reduction in price target, the firm maintained its positive outlook on the company’s stock. According to InvestingPro, GitLab holds more cash than debt and maintains strong liquidity with a current ratio of 2.45.
GitLab’s management indicated there were "no surprises in the quarter" but highlighted several dynamics affecting results, including a higher Software-as-a-Service (SaaS) mix, linearity issues, and fewer days in the reporting period.
The company maintained its revenue guidance for fiscal year 2026, which RBC viewed as a positive sign amid current market conditions. The analyst report specifically mentioned that macroeconomic concerns remain on investors’ minds.
RBC Capital expressed continued optimism about GitLab’s company-specific growth drivers, which factored into its decision to maintain the Outperform rating despite the lower price target.
In other recent news, GitLab has been the focus of several analyst evaluations following its first-quarter fiscal 2026 results. Truist Securities lowered its price target for GitLab to $75 from $80, maintaining a Buy rating, citing underwhelming performance despite exceeding the company’s guidance range. Piper Sandler reiterated its Overweight rating with an $85 price target, noting GitLab’s lowest revenue beat since going public but highlighting strong short-term billings growth and free cash flow. Bernstein also reduced its price target to $70 from $76, maintaining an Outperform rating due to GitLab’s modest revenue beat and unchanged full-year guidance. Needham slashed its price target significantly to $55 from $85, while still maintaining a Buy rating, citing market uncertainties and competitive pressures. Scotiabank (TSX:BNS) adjusted its price target to $60 from $67, maintaining a Sector Outperform rating, noting a smaller revenue beat and stable RPO. Despite these adjustments, analysts expressed confidence in GitLab’s strategic position and potential for growth, emphasizing its AI integration and strong enterprise customer base.
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