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Investing.com - Mizuho raised its price target on Braze Inc (NASDAQ:BRZE) to $45.00 from $40.00 on Friday, while maintaining an Outperform rating following the company’s strong fiscal second-quarter results. According to InvestingPro data, the company currently trades below its Fair Value, with a market capitalization of $3.07 billion.
Braze delivered revenue of $180 million, representing 24% year-over-year growth (22% organic), which exceeded consensus estimates of 18% growth. The performance was driven by broad-based demand strength and better-than-expected moderation in down-selling. The company maintains a strong financial position with more cash than debt and a healthy current ratio of 1.37.
The company posted an operating margin of 3.4%, significantly above the consensus estimate of 0.7%. Net revenue retention rate slightly decreased to 108% from 109% in the previous quarter, but in-period retention stabilized over the past seven months and showed modest improvement in the second quarter.
Management raised its fiscal year 2026 revenue growth guidance to 21% year-over-year and increased its operating margin forecast to 3.5%, compared to the consensus estimate of 1.2%. Mizuho views this guidance as conservative. While currently unprofitable, InvestingPro analysis shows analysts expect the company to achieve profitability this fiscal year. Get access to 6 more exclusive ProTips and comprehensive financial analysis with an InvestingPro subscription.
The firm also noted early promising signs from Braze’s OfferFit product, which secured new enterprise wins across major geographies and is expected to contribute approximately 2 percentage points to fiscal year 2026 growth. The company’s upcoming Forge user conference on September 29-30 is identified as the next catalyst.
In other recent news, Braze Inc. reported strong financial results for the second quarter of fiscal year 2026. The company achieved an earnings per share of $0.15, which was significantly higher than the forecasted $0.03, representing a 400% surprise. Revenue for the quarter reached $180.1 million, surpassing projections by nearly 5%. Despite these impressive results, Braze’s stock experienced a slight dip in aftermarket trading. These developments highlight the company’s robust performance in the recent quarter. Investors and analysts will likely keep a close watch on Braze’s future performance given these results.
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