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On Thursday, Goldman Sachs reiterated its Buy rating and $50.00 price target for Braze Inc (NASDAQ:BRZE), a customer engagement platform. This aligns with the broader analyst consensus, as InvestingPro data shows 13 analysts have recently revised their earnings estimates upward, with price targets ranging from $38 to $75. Goldman Sachs addressed concerns regarding the health of Braze’s business-to-consumer (B2C) customer base and the possibility of budget reductions within marketing and advertising sectors. The firm highlighted the absence of indicators suggesting a slowdown in Braze’s operations despite broader market volatility seen year-to-date (YTD).
Braze’s stock has seen a 17% decline YTD, underperforming the NASDAQ’s 2% drop, which Goldman Sachs attributes to investor worries. However, the company maintains strong fundamentals, with InvestingPro data showing impressive revenue growth of 25.78% and a healthy current ratio of 1.98. The research firm’s discussions imply continued enterprise investment in revenue-generating areas and tools that support long-term artificial intelligence (AI) initiatives, which could benefit Braze.
Goldman Sachs anticipates that Braze’s focus on customer engagement and the system integrator (SI) ecosystem may accelerate market share gains. The firm also notes Braze’s pricing model, which largely depends on monthly active users (estimated at around 40-45%), along with email and SMS volumes, a platform fee, and additional services, offers some protection against potential downturns in consumer spending in the second half of the year.
During a recent customer event in New York, "Grow with Braze," Goldman Sachs gathered insights from customers and partners. Despite limited visibility into marketing expenditures, there was notable enthusiasm for how Braze enables marketers to achieve more with fewer resources.
Goldman Sachs concludes that with Braze’s stock trading at 4 times its 2026 enterprise value to sales (EV/Sales) and the potential for increased free cash flow (FCF) to support a higher stock price in the near term, Braze remains a top selection within their coverage area. InvestingPro analysis indicates the stock is fairly valued at current levels, with additional ProTips and detailed financial metrics available to subscribers, including comprehensive valuation models and peer comparison tools in the Pro Research Report.
In other recent news, Braze Inc. reported significant financial achievements and strategic initiatives that have caught the attention of several analysts. The company surpassed top-line expectations by 3%, with a 22% year-over-year revenue increase, and achieved a trailing twelve-month Dollar-Based Net Retention Rate of 111% for fiscal year 2025. Citi analyst Tyler Radke raised the price target for Braze shares to $55, citing strong performance and a promising outlook for fiscal year 2026, including a 16% organic growth forecast. Similarly, TD Cowen increased its price target to $47, highlighting a 22.5% revenue growth in the fourth quarter and strategic acquisitions like OfferFit, which is expected to enhance Braze’s AI capabilities.
DA Davidson maintained a Buy rating with a $50 price target, emphasizing Braze’s strong new business momentum and better-than-expected profitability. The firm also noted the potential for upside due to favorable industry dynamics. UBS reiterated its Buy rating with a $51 target, recognizing Braze’s robust performance despite market concerns and forecasting a potential 20% revenue growth in fiscal 2026. Macquarie increased its price target slightly to $40, maintaining a neutral stance while acknowledging Braze’s progress towards profitability and strategic partnerships. These developments reflect a broad acknowledgment of Braze’s solid financial performance and strategic positioning in the market.
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