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On Thursday, RBC Capital Markets adjusted its outlook on MongoDB stock (NASDAQ:MDB), reducing the price target to $320 from the previous $400, while still maintaining an Outperform rating on the shares. Currently trading at $264, the stock sits well above its 52-week low of $213 but significantly below its high of $424. According to InvestingPro data, analyst targets for MongoDB range from $180 to $520, reflecting diverse market opinions about the company’s prospects. The adjustment comes in the wake of MongoDB’s recent earnings report, which, despite showcasing a solid quarter, also included guidance that fell short of market expectations, prompting a significant 16% drop in the company’s shares during after-hours trading.
MongoDB’s financial guidance for FY26 revealed revenue and operating margin projections that were notably below the consensus. The company cited a decrease in multiyear deal activity as a factor contributing to a $50 million shortfall in revenue, equating to a 3-point deceleration in growth. Despite these challenges, InvestingPro analysis shows MongoDB maintains strong fundamentals with a healthy current ratio of 5.2 and minimal debt exposure. The company’s revenue growth remains robust at 19.2% year-over-year, with analysts expecting continued profitability in the coming year. Despite this, MongoDB’s Atlas (NYSE:ATCO) revenue displayed resilience in the fourth quarter, with a 24% increase, though this marked a 2-point deceleration from the third quarter. The performance of Atlas, MongoDB’s cloud database service, remained stable and exceeded the company’s expectations.
The RBC Capital analyst highlighted the disparity between MongoDB’s solid performance and the market’s reaction to the guidance as a significant factor. The perceived overreaction to the guidance, which the analyst suggests is more noise than substance, has been seen as an opportunity for investors to buy into the company at a more attractive price point.
The company’s stock price movement following the earnings report and revised guidance reflects the immediate market response to MongoDB’s financial outlook. As investors reassess the company’s value in light of the new information, the market will continue to monitor MongoDB’s performance and its ability to adapt to the challenges presented by the lessened activity in multiyear deals. Based on InvestingPro’s comprehensive analysis, which includes over 30 financial metrics and exclusive ProTips, MongoDB’s current Fair Value assessment suggests the stock is fairly valued. Investors seeking deeper insights can access the full Pro Research Report, available exclusively to InvestingPro subscribers, offering detailed analysis of MongoDB’s financial health, growth prospects, and market position.
In other recent news, MongoDB’s fourth-quarter earnings report revealed a 20% revenue increase, surpassing consensus estimates by 5.3%. This performance was bolstered by the Atlas platform, which grew by 24% and outperformed consensus and buy-side expectations. Despite the impressive results, MongoDB’s conservative guidance for fiscal year 2026 has led to mixed analyst reactions. Citi maintained a Buy rating with a $430 target, noting the potential of Atlas and new workload acquisitions. Conversely, Guggenheim and Piper Sandler reduced their price targets to $300 and $280, respectively, citing growth concerns and headwinds in non-Atlas segments.
William Blair reiterated an Outperform rating, highlighting MongoDB’s strong operating margin, which exceeded forecasts by 932 basis points. Cantor Fitzgerald also maintained a positive outlook with an Overweight rating, despite lowering the price target to $332. The firm emphasized the potential for Atlas-based revenue to outperform near-term expectations. These developments underscore the varied analyst perspectives on MongoDB’s future performance, with a focus on the Atlas platform’s continued growth and potential challenges in the broader software market.
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