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Investing.com - Raymond James lowered its price target on GitLab Inc (NASDAQ:GTLB) to $55.00 from $60.00 on Thursday, while maintaining an Outperform rating on the software development platform. According to InvestingPro data, the stock currently trades at a significant premium with a P/E ratio of 566x.
The price target reduction follows GitLab’s second-quarter results, which showed strong upside relative to expectations. The company maintains impressive fundamentals with an 88.64% gross profit margin and robust 29.31% revenue growth. This performance was particularly important after the company’s first quarter featured a smaller beat.
GitLab maintained its forward guidance, which Raymond James described as a wise decision given the upcoming chief financial officer transition. The company announced that current CFO Brian Robins will be leaving to take the CFO role at Snowflake.
Raymond James cited GitLab’s attractive valuation given its growth and profitability metrics as reasons for maintaining the Outperform rating despite the price target cut.
The firm did express some longer-term concerns about CEO Bill Staples’ multi-part reorganization plan announced during the earnings call, drawing comparisons to similar initiatives at New Relic that led to prediction challenges and customer churn.
In other recent news, GitLab Inc reported second-quarter revenue of $236 million, marking a 29.2% increase year-over-year and surpassing both BTIG’s and Wall Street’s expectations of approximately $226.9 million. Despite these strong results, BTIG has lowered its price target for GitLab to $57, expressing concerns about the company’s revenue outlook. RBC Capital has maintained its Outperform rating and $58 price target, noting GitLab’s solid performance and conservative fiscal year 2026 revenue guidance. Goldman Sachs, however, reduced its price target to $48, citing growth concerns as GitLab reiterated its fiscal 2026 guidance with a slower projected growth rate in the second half of the year. BofA Securities continues to hold a Buy rating with a $72 price target, highlighting GitLab’s strong quarterly performance and accelerated subscription revenue growth. Wolfe Research also adjusted its price target to $52 while maintaining an Outperform rating, pointing out that GitLab’s stock trades at a discount compared to its peers. These developments reflect a mix of confidence and caution among analysts regarding GitLab’s future performance.
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