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On Thursday, Stifel analysts reiterated a Hold rating and maintained a $10.00 price target for Sprinklr Inc (NYSE: CXM), with analyst targets ranging from $7 to $17. According to InvestingPro data, the stock appears slightly undervalued at its current price of $9.06. The decision follows a review of the company’s recent performance, which exceeded estimates, particularly in profitability metrics, with the company achieving a solid 71% gross profit margin. The company’s new business management system and a focus on efficiency have resulted in record free cash flow, as well as non-GAAP operating and net margin figures.
The company is transitioning beyond its first-quarter restructuring activities and plans to reinvest in key areas such as artificial intelligence development and go-to-market strategies in the latter half of the year. With a strong balance sheet showing more cash than debt and liquid assets exceeding short-term obligations, the company is well-positioned for these investments. CEO Rory Read emphasized the need for more time to achieve significant top-line growth, describing fiscal year 2026 as a transition period, with revenue growth forecast at 4% for the fiscal year.
Sprinklr’s operating margin showed a notable quarter-over-quarter improvement of 510 basis points. This improvement aligns with the company’s efforts to optimize operations and enhance profitability, reflected in its return on equity of 17% and positive earnings of $0.40 per share over the last twelve months. Despite these gains, the company remains focused on long-term growth and reinvestment opportunities. InvestingPro subscribers can access 13 additional key insights about Sprinklr’s financial health and growth prospects.
A key initiative, "Project Bear Hug," was highlighted during a recent call. This initiative aims to integrate sales, service, product, and marketing functions while engaging with the company’s top 500-600 customers. Sprinklr has already reached approximately 200 of its top clients and reported early positive results from the initiative.
Stifel analysts’ decision to maintain their rating reflects confidence in Sprinklr’s current profitability trajectory while acknowledging the company’s ongoing efforts to drive growth and efficiency.
In other recent news, Sprinklr Inc. reported its fiscal first-quarter 2026 results, which exceeded expectations. The company posted a non-GAAP earnings per share of $0.12, surpassing the consensus estimate of $0.05. Revenue for the quarter was $205.5 million, beating the forecast of $201.8 million and marking a 5% year-over-year increase. Analysts from Citizens JMP maintained a Market Outperform rating on Sprinklr, setting a price target of $17.00, while DA Davidson raised their price target to $9 from $8, maintaining a Neutral rating. The company’s net revenue retention and current remaining performance obligations are stabilizing, attributed to ongoing resource reallocation efforts. Despite these positive results, Sprinklr is still in the early stages of a multiyear turnaround plan. The company launched an AI-native customer experience management platform and implemented workforce reduction and restructuring efforts. Sprinklr’s strategic initiatives aim to drive growth and maintain market leadership in a challenging macroeconomic environment.
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