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Investing.com - TD Cowen has lowered its price target on GitLab Inc (NASDAQ:GTLB) to $62.00 from $67.00 while maintaining a Buy rating on the software development platform. The stock, currently trading at $43.70, has seen a significant 31.85% decline over the past six months, though InvestingPro analysis suggests it’s trading near its Fair Value.
The firm’s adjustment comes ahead of GitLab’s second-quarter earnings report scheduled for September 3. Despite the price target reduction, TD Cowen indicates its checks continue to show healthy growth trends for the company, supported by impressive revenue growth of 29.31% and an industry-leading gross profit margin of 88.64%.
The research note specifically addresses concerns about artificial intelligence coding tools, stating these new technologies are not negatively impacting demand for GitLab’s services. TD Cowen suggests AI tools could actually serve as a "net tailwind" for the company.
TD Cowen also points to positive operational indicators, noting that GitLab’s sales hiring activity and open U.S. development jobs have rebounded quarter-over-quarter, suggesting continued business expansion.
The firm considers GitLab’s current valuation of approximately 5.5 times enterprise value to estimated calendar year 2026 sales attractive for a company with a mid-20% growth outlook, and believes negative market sentiment toward the stock is "overblown."
In other recent news, GitLab Inc. has been the focus of various developments. The company is set to release its fiscal second-quarter 2026 earnings report, with Cantor Fitzgerald maintaining an Overweight rating and a $60.00 price target, citing long-term growth prospects. A strategic collaboration with Amazon (NASDAQ:AMZN) Web Services (AWS) has been announced, aiming to expand GitLab Dedicated for regulated industries over the next three years. GitLab’s Agent Platform has entered public beta, which BofA Securities sees positively, maintaining a Buy rating and a $72.00 price target. The company has also launched the public beta of its GitLab Duo Agent Platform, designed for AI-developer collaboration. However, CapitalOne has downgraded GitLab from Overweight to Equal-weight, lowering the price target to $46.00 due to concerns over product differentiation in the competitive software development market. These recent developments highlight GitLab’s ongoing efforts to expand its offerings and partnerships while facing challenges in maintaining product uniqueness.
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