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Baird downgraded PROS Holdings (NYSE:PRO) from Outperform to Neutral on Monday, while reducing its price target to $18.00 from $27.00. The research firm cited concerns about the company’s ability to execute its long-term targets following recent leadership changes. According to InvestingPro data, the stock is currently trading near its 52-week low of $14.81, with shares down nearly 20% in the past week alone.
The downgrade comes as PROS Holdings operates under a new CEO and currently has no Chief Revenue Officer. Baird acknowledged that while organizational change can be beneficial, it introduces additional risk to the company’s performance outlook. Despite these challenges, the company has maintained revenue growth of 8% over the last twelve months, though it remains unprofitable with negative earnings per share of $0.27.
Despite noting that PROS shares are trading at relatively inexpensive levels, Baird expects it will take considerable time before the recent leadership changes yield positive results. The firm also believes the company faces challenges in restoring investor confidence regarding its business targets. InvestingPro’s Fair Value analysis suggests the stock is currently undervalued, with 8 additional exclusive insights available to subscribers.
The research firm recognized the timing of its downgrade is not ideal, as it comes when the stock is trading near recent lows. PROS Holdings provides artificial intelligence-powered solutions that help businesses optimize pricing, revenue management, and sales effectiveness.
The stock has faced pressure in recent months amid broader concerns about enterprise software spending and the company’s own execution challenges. PROS Holdings is scheduled to report its next quarterly earnings in late July.
In other recent news, PROS Holdings reported its financial results for the first quarter of 2025, surpassing analysts’ expectations with an earnings per share of $0.13, compared to the forecasted $0.12. The company also exceeded revenue expectations, reporting $86.3 million against a forecast of $85.7 million. PROS Holdings reaffirmed its financial outlook for the second quarter of 2025, indicating no changes to its previously stated guidance. At their annual stockholder meeting, shareholders approved several key decisions, including the election of directors and amendments to the equity incentive plan. Needham analyst firm reiterated a Buy rating on PROS Holdings, maintaining a price target of $25.00, despite recent changes in the company’s sales leadership. The company also announced the results of its annual stockholder meeting, where shareholders ratified the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025. Additionally, PROS Holdings is set to host a virtual investor Q&A session, which will feature key executives and provide further insights into the company’s performance and strategies.
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