How are energy investors positioned?
On Wednesday, Raymond (NSE:RYMD) James analyst Brian Peterson adjusted the price target for OneStream Inc. (NASDAQ: OS) shares, bringing it down to $32 from the previous $35, while still maintaining an Outperform rating on the company. According to InvestingPro data, analyst targets for OneStream range from $30 to $40, with a strong consensus recommendation of 1.59 (Buy). Peterson’s move follows OneStream’s fourth-quarter earnings report, which, despite being negatively affected by foreign exchange (FX) issues and some extended deal cycles, managed to surpass consensus expectations for the most part.
OneStream, a provider of corporate performance management software, exhibited solid fundamental growth, with most key metrics growing well into the 20s percentage-wise, even considering a roughly 2-point impact from FX headwinds. The company maintains strong fundamentals with a current ratio of 2.45 and more cash than debt on its balance sheet. Peterson acknowledged that the company’s premium valuation might have set investor expectations for greater upside, which did not fully materialize. Indeed, InvestingPro analysis indicates the stock is currently trading above its Fair Value, with a notably high Price/Book ratio of 22.08.
After the earnings report, OneStream’s stock experienced a downturn, dropping 13% in after-hours trading. Peterson noted that while the market might react to the report with a degree of caution, especially considering the macroeconomic environment and the transformational deal sizes associated with OneStream’s product, he believes the long-term growth trajectory for the company remains intact. He pointed out that most of the deals that had slipped were expected to close in the first quarter of 2025.
Investors are advised that despite the short-term setbacks, the fundamental growth story for OneStream does not appear to have changed significantly. Peterson’s comments suggest a continued confidence in the company’s long-term potential, even as the market adjusts to the new price target and recent earnings report outcomes.
In other recent news, OneStream Inc. has experienced a series of analyst rating changes and a secondary stock offering. JPMorgan analysts downgraded OneStream’s stock rating from Overweight to Neutral and lowered its price target to $26 following the release of fourth-quarter results. These results confirmed a trend of deal slippage at OneStream, which has led to a reassessment of the stock’s outlook. Conversely, Morgan Stanley (NYSE:MS) upgraded OneStream’s stock rating from Equalweight to Overweight, setting a new price target of $37.00. The firm cited OneStream’s underperformance compared to peers since its initial public offering as an attractive entry point for investors. Goldman Sachs also initiated coverage on OneStream, assigning the stock a Buy rating and a price target of $37.00. The firm highlighted OneStream’s unified Corporate Performance Management platform as a major factor in creating a durable demand opportunity. On another note, OneStream announced a proposed underwritten public offering of 15 million shares of its Class A common stock, with proceeds from its shares intended to buy LLC units from KKR Dream Holdings LLC. These are some of the recent developments surrounding OneStream Inc.
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