U.S. stocks edge higher; solid earnings season continues
Investing.com - Stifel has reduced its price target on Klaviyo Inc (NYSE:KVYO) to $40.00 from $45.00 while maintaining a Buy rating on the marketing automation company’s stock. The company, currently valued at $8.68 billion, has demonstrated impressive gross profit margins of 76% and strong revenue growth of 34% over the last twelve months.
The price target adjustment comes as Klaviyo shares have underperformed compared to the iShares Expanded Tech-Software Sector ETF (IGV), declining 6% since the company’s first-quarter earnings release on May 7, while the IGV has gained 10% during the same period. According to InvestingPro analysis, Klaviyo holds more cash than debt on its balance sheet and maintains strong liquidity with current assets exceeding short-term obligations.
Stifel notes this underperformance has occurred despite cooling tariff and recession fears since their April highs, along with Klaviyo’s continued platform expansion to address more marketing workflows and eventual service use-cases. Get access to 8 additional key insights about Klaviyo with an InvestingPro subscription, including detailed analysis and Fair Value estimates.
The research firm believes Klaviyo is "well positioned to deliver upside on both the top and bottomlines" for the second quarter, with expectations for the company to provide an updated outlook projecting growth in the high-20% range for the year.
Stifel also highlighted interest in upcoming updates regarding new solutions Klaviyo introduced earlier this year and how the company’s growth strategy will evolve as it secures larger clients with multiple product implementations.
In other recent news, Klaviyo Inc. has been in the spotlight with several noteworthy developments. The company released a public beta of its Conversational AI Agent, part of the Klaviyo Service suite, designed to offer AI-powered shopping assistance to online retailers. This tool is expected to help brands provide personalized customer support and is set to expand its capabilities later this year. Meanwhile, Cantor Fitzgerald initiated coverage of Klaviyo with an Overweight rating, highlighting its strong growth rate and competitive position within the e-commerce sector. The firm set a price target of $48, reflecting optimism about Klaviyo’s future revenue estimates. Additionally, Klaviyo’s CEO, Andrew Bialecki, has commenced a public offering of Series A common stock valued at $372 million to cover tax obligations related to stock options. The company itself will not benefit financially from this sale, which is managed by Goldman Sachs & Co. LLC and Morgan Stanley (NYSE:MS). In another analyst move, Benchmark raised its price target for Klaviyo stock to $44 while maintaining a Buy rating, following stable first-quarter results. This stability is attributed to consistent cross-selling efforts and an emerging pipeline for customer service and marketing analytics solutions.
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