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On Wednesday, Rosenblatt analysts increased the price target for Couchbase Inc stock (NASDAQ: BASE) to $22 from $20, maintaining their Buy rating. This decision follows Couchbase’s announcement of strong first-quarter results, showing a 10% year-over-year revenue growth to $56.5 million, exceeding analysts’ revenue estimates by approximately 1.7%. According to InvestingPro data, analyst targets for the stock range from $16 to $26, with the company currently valued at approximately $1 billion market cap.
The company’s Q1 performance was driven by a 12% year-over-year increase in subscription revenue. This growth was supported by robust license performance and the continued rapid adoption of Couchbase’s newer cloud-based offering, Capella. Capella accounted for 17.4% of the total annual recurring revenue (ARR), growing over 80% compared to the previous year. The company maintains impressive gross profit margins of 88.08% and holds more cash than debt on its balance sheet, though growth in customer count was modest as some Starter Pack customers left.Want deeper insights? InvestingPro subscribers have access to over 10 additional key metrics and exclusive analysis for Couchbase, including detailed financial health scores and Fair Value estimates.
Looking forward, Couchbase’s guidance for the second quarter showed mixed results compared to pre-quarter consensus, with better expectations for ARR but lower revenue projections. Despite this, the company’s annual guidance was increased, albeit by less than the Q1 beats.
Rosenblatt analysts made slight adjustments to their fiscal year 2026-27 growth forecasts following the Q1 earnings report. They highlighted the strong performance of Couchbase’s Capella offering as a significant factor in their decision to raise the price target.
In other recent news, Couchbase Inc. reported strong first-quarter fiscal year 2026 results, with its annual recurring revenue (ARR) reaching $252.1 million, marking a 20% year-over-year growth at constant currency. This performance exceeded consensus estimates and led to revised upward guidance for the fiscal year, although the adjustments were conservative due to macroeconomic uncertainties. Multiple analyst firms have responded to these results, with Truist Securities, Stifel, and DA Davidson all maintaining their Buy ratings on the stock, setting price targets of $21.00, $22.00, and $25.00, respectively.
Goldman Sachs, however, continues to hold a Sell rating with a price target of $16, citing concerns about the company’s path to positive operating margins and competition from larger rivals. Despite these concerns, Couchbase’s Capella product showed significant growth, contributing to the highest first-quarter net new ARR ever, though the overall ARR growth is projected to be below 20% for the fiscal year. Morgan Stanley (NYSE:MS) raised its price target to $19 from $18, maintaining an Equalweight rating, and noted the company’s strong performance and product innovation.
Revenue growth, however, slightly lagged behind ARR due to migration challenges. Analysts have highlighted the importance of reaccelerating Capella migrations and customer acquisition to maintain momentum. Couchbase’s focus on strategic expansions and technological advancements positions it for continued growth in the evolving AI landscape.
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