HubSpot stock price target lowered to $650 at Stifel on AI concerns

Investing.com - Stifel has lowered its price target on HubSpot Inc (NYSE:HUBS) to $650 from $700 while maintaining a Buy rating on the stock. According to InvestingPro data, analyst targets range from $593 to $910, with the stock currently trading near $458, suggesting significant potential upside despite recent market pressure.

The price target reduction follows what Stifel described as a "good" earnings report from HubSpot "across the board," featuring healthy customer net additions and modest net revenue retention expansion. The company maintains impressive gross profit margins of 84.5% and achieved nearly 19% year-over-year revenue growth.

The firm noted that HubSpot reported "many compelling metrics around AI utilization" but continues to face challenges regarding the potential impact of agentic AI on seat-based business models.

Stifel attributed the price target reduction to "multiple compression" despite maintaining its positive outlook on the company’s fundamentals.

Looking ahead, Stifel expects HubSpot’s positioning around and monetization of agentic AI offerings to be a major focus at the upcoming INBOUND conference and analyst day, along with the company’s strategy in the evolving search market and an update to midterm margins.

In other recent news, HubSpot reported impressive financial results, with revenue reaching $761 million, marking a 19% year-over-year growth. The company’s operating income was $129 million, with a 17% margin, surpassing forecasts by $5 million. Despite these strong numbers, several analyst firms have adjusted their price targets for HubSpot. KeyBanc lowered its price target to $775, citing market conditions, while maintaining an Overweight rating. BMO Capital also reduced its target to $600, despite acknowledging HubSpot’s solid performance across all metrics. UBS adjusted its price target to $700 due to valuation concerns, although it retained a Buy rating. Needham reiterated its Buy rating, highlighting HubSpot’s solid second-quarter results. Wolfe Research maintained its Outperform rating and $655 price target, noting the company’s efforts to address AI’s impact on search engine optimization.

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