Jefferies initiates Avepoint stock with Buy rating, $22 price target

Investing.com - Jefferies initiated coverage on Avepoint Inc. (NASDAQ:AVPT), currently trading at $18.79 with a market capitalization of $3.98 billion, with a Buy rating and set a price target of $22.00.

The research firm highlighted Avepoint’s position as a data protection platform for evolving enterprise data environments, noting the company has "impressively cemented itself" in this space, demonstrated by its robust 75.36% gross profit margin and 21.7% revenue growth over the last twelve months.

Jefferies pointed to artificial intelligence as a factor making data estates more complex, with Avepoint’s unified suite of data solutions enabling "businesses’ mission-critical operations in light of the AI tidal wave." According to InvestingPro, the company maintains strong financial health with more cash than debt on its balance sheet, one of several positive indicators available in the comprehensive Pro Research Report.

The firm believes secular tailwinds make Avepoint’s 2025 annual recurring revenue targets achievable and should drive "sustained high growth for several years."

Jefferies indicated the current valuation of approximately 8 times the enterprise value to estimated 2026 revenue ratio justifies the Buy rating and $22 price target.

In other recent news, AvePoint reported strong first-quarter 2025 earnings, with total revenues reaching $93.1 million, surpassing the forecast of $88.31 million. This performance was highlighted by a 34.37% increase in SaaS revenue, contributing to the company’s financial stability. The company also provided guidance for the second quarter, anticipating a 23.5% revenue increase, exceeding Wall Street expectations. Additionally, AvePoint raised its fiscal year 2025 revenue growth guidance midpoint to 21.5% from the previously projected 16%. Analyst firm Evercore ISI responded by raising the stock’s price target to $20, citing the company’s robust first-quarter results and favorable future outlook.

AvePoint has also introduced new capabilities to its Confidence Platform, including command centers focused on cost optimization and data resilience, as well as expanded AI governance features. These updates align with industry trends, as 92% of companies plan to implement cost-saving measures. The company aims to expand these capabilities to platforms like Salesforce (NYSE:CRM) and Google (NASDAQ:GOOGL) Workspace by 2025. Despite macroeconomic uncertainties, AvePoint has not observed any headwinds affecting data modernization projects, indicating a potentially conservative outlook for the second half of the year.

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