Piper Sandler maintains Overweight rating on GitLab stock

Published 04/03/2025, 16:22
Piper Sandler maintains Overweight rating on GitLab stock

On Tuesday, Piper Sandler expressed continued confidence in GitLab Inc (NASDAQ:GTLB), reiterating an Overweight rating and maintaining the $85.00 price target. The endorsement follows GitLab’s robust fourth-quarter performance, which capped off a remarkable fiscal year 2025. According to InvestingPro data, analyst consensus remains highly bullish, with price targets ranging from $58 to $90. The company’s results showed strong execution with no signs of deceleration, even amid a CEO transition.

GitLab’s fourth-quarter report highlighted a 34% growth in calculated remaining performance obligations (cRPO) and an 18% operating margin, underscoring a solid end to the fiscal year. InvestingPro data reveals impressive fundamentals, including an 88.79% gross profit margin and robust revenue growth of 30.93% over the last twelve months. The company maintains strong liquidity with a current ratio of 2.47, though it’s currently trading above its Fair Value. The appointment of a new Chief Revenue Officer (CRO) and a conservative guidance for the upcoming year set a stable foundation for the company’s future prospects.

Piper Sandler analysts pointed to the introduction of new products like Duo as key growth drivers just starting to gain traction. These innovations are expected to contribute to GitLab’s ongoing success. The firm’s analysts remain optimistic about GitLab’s trajectory, citing the company as a top pick within their coverage.

The positive outlook from Piper Sandler comes at a pivotal moment for GitLab, as the company navigates leadership changes and sets its sights on the year ahead. With a solid performance foundation and strategic growth initiatives in place, GitLab is positioned to continue its upward trend in the competitive software development industry. For deeper insights into GitLab’s financial health and growth prospects, including 8 additional ProTips and comprehensive valuation metrics, explore the detailed Pro Research Report available on InvestingPro.

In other recent news, GitLab Inc reported a solid performance in its latest financial results, exceeding its revenue guidance by 2.9% for the fiscal fourth quarter of 2025. The company also demonstrated significant year-over-year revenue growth of 29%, alongside a notable improvement in non-GAAP operating margin. Analysts from KeyBanc, Cantor Fitzgerald, Macquarie, and Needham have maintained their positive ratings on GitLab, with price targets ranging from $76 to $90, reflecting confidence in the company’s strategic direction and growth potential. KeyBanc highlighted GitLab’s modest fourth-quarter earnings beat and strategic hires, while Macquarie noted robust growth in key performance metrics such as Remaining Performance Obligations and calculated billings.

Cantor Fitzgerald emphasized GitLab’s market consolidation strategy and its comprehensive platform capabilities, including the recent introduction of Gen-AI assistant features. Needham pointed out GitLab’s strong traction with high-value customer orders and the growing market presence of its Ultimate product, which now accounts for half of the Total (EPA:TTEF) Annual Recurring Revenue. Despite a slight reduction in the price target by Bernstein to $76, the firm continues to recommend GitLab with an Outperform rating, citing the company’s consistent performance and strategic leadership under CEO Bill Staples. The appointment of a new Chief Revenue Officer and board member David Henshall is seen as a positive development for GitLab’s governance and market strategy. These recent developments underscore GitLab’s potential for sustained growth and market share expansion.

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