Morgan Stanley lifts nCino stock price target to $29 from $27

On Thursday, Morgan Stanley (NYSE:MS) updated its stance on nCino Inc. (NASDAQ:NCNO), increasing the company’s price target from $27.00 to $29.00, while maintaining an Equalweight rating on the stock. According to InvestingPro data, nCino currently trades at an EV/EBITDA multiple of 104.7x, indicating a premium valuation. The firm’s analysts highlighted that despite an unchanged Annual Contract Value (ACV) outlook and the fourth quarter of fiscal year 2026 being the lowest point for subscription revenue growth, management remains confident in a fiscal year 2027 acceleration.

The analysts at Morgan Stanley expressed a cautious optimism, noting that they are encouraged by the company’s adoption of a more conservative outlook methodology and recent operational expenditure actions. While nCino operates with a moderate debt-to-equity ratio of 0.22 and maintains a healthy current ratio of 1.2, these strategic moves by management seem to have prompted Morgan Stanley to adjust the price target upward. InvestingPro analysis suggests the stock is currently undervalued, with additional insights available in the comprehensive Pro Research Report.

The report from Morgan Stanley suggests that while they are keeping their rating steady, the slight increase in the price target reflects a nuanced view of nCino’s future performance. Despite a challenging six-month period with a -36% return, the company has shown recent momentum with strong monthly gains. The analysts’ comments indicate that while they are not fully convinced of a significant acceleration, they acknowledge the potential for growth based on the company’s conservative forecasting and cost management efforts.

nCino, which specializes in cloud banking, has been under scrutiny by investors seeking signs of stable growth in the competitive tech sector. With revenue growth of ~13% in the last twelve months and gross margins of 60%, the company’s management has evidently been working to set realistic expectations and control operating expenses, which has been recognized by Morgan Stanley’s recent price target adjustment.

The new price target of $29.00 set by Morgan Stanley provides a modestly more optimistic outlook for nCino’s shares, as the company navigates through its forecasted trough in subscription revenue growth and aims for an acceleration in the next fiscal year. For deeper insights into nCino’s valuation and growth prospects, investors can access additional ProTips and comprehensive financial metrics through InvestingPro.

In other recent news, nCino Inc. reported strong financial results for the first quarter of fiscal year 2026, with earnings surpassing Wall Street expectations. The company posted earnings per share of $0.16, exceeding the forecasted $0.1553, and revenues reached $144.1 million, beating the anticipated $139.82 million. This performance was driven by a 13% year-over-year revenue increase, including a 14% rise in subscription revenue. JMP Securities maintained a Market Outperform rating for nCino with a price target of $32, acknowledging the company’s robust financial outcomes.

Goldman Sachs also adjusted its price target for nCino to $27, maintaining a Neutral rating. The firm noted the company’s first-quarter earnings beat but highlighted potential challenges in the latter half of the year due to the need for successful new product execution. Despite the positive start, nCino’s management confirmed their full-year bookings and Annual Contract Value (ACV) targets, while also anticipating cost savings from workforce and office space reductions.

The company reiterated its FY26 annual contract value target of $48 million to $51 million, projecting 19% organic growth. nCino’s management emphasized their strategic focus on AI and innovation, which they believe positions the company competitively in the market. The company is set to host investor meetings in Boston, allowing for direct engagement with the investment community.

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