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On Friday, Tigress Financial Partners updated its outlook on monday.com Ltd. (NASDAQ:MNDY), raising the 12-month price target to $450 from a previous target, while maintaining a Buy rating on the stock. The firm’s analysts highlighted the company’s integration of artificial intelligence (AI) into its Work OS platform as a key driver of increased customer adoption and accelerated revenue and cash flow growth. According to InvestingPro data, monday.com has demonstrated strong financial health with a current ratio of 2.66 and more cash than debt on its balance sheet, though the stock appears slightly overvalued at current levels based on InvestingPro’s Fair Value analysis.
In a recent earnings report, monday.com announced record AI-driven Q4 and FY 2024 results, with Q4 2024 revenue surging 32% year-over-year to $268.0 million, and FY 2024 revenue climbing 33% year-over-year to $972.0 million. The company also reported a significant increase in net dollar retention rates across various customer segments, including a 112% overall net dollar retention rate and higher rates for customers with larger annual recurring revenue (ARR). The company’s impressive gross profit margin of 89.33% underscores its operational efficiency, and InvestingPro analysts expect net income to grow further this year.
The growth in paid customers was notable, with a 10% year-over-year increase in users with more than 10 users, a 39% increase in customers with over $50K in ARR, and a 45% increase in customers with more than $100K in ARR. Tigress Financial’s analysis emphasized the company’s robust enterprise management platform and the introduction of the Digital Workforce, a team of AI Agents capable of handling complex tasks.
The firm’s statement also mentioned the launch of monday Service, an AI-first enterprise service management solution that has seen strong initial demand. The company’s AI strategy for 2025 focuses on AI Blocks, Product Power-ups, and Digital Workforce, which are expected to further automate tasks and integrate AI to meet specific user needs.
Tigress Financial concluded that the scalable and adaptable nature of monday.com’s Work OS, along with strong brand recognition, positions the company to penetrate a massive and growing total addressable market (TAM), driving significant revenue and cash flow growth. The firm’s analysts believe that the new price target offers a potential return of 45% from current stock levels. With a market capitalization of $15.59 billion and year-to-date returns of 30.82%, monday.com has shown strong momentum. For deeper insights into monday.com’s valuation and growth prospects, including 10+ additional ProTips and comprehensive financial analysis, visit InvestingPro to access the detailed Pro Research Report.
In other recent news, monday.com Ltd. has reported notable financial achievements and strategic developments. The company exceeded expectations in its fourth-quarter fiscal year 2024 revenue, with a 32% year-over-year increase, leading to upward revisions in revenue forecasts by several analysts. UBS has raised its fiscal year 2025 revenue estimate to $1,221 million, reflecting a 26% growth, while Goldman Sachs and Scotiabank (TSX:BNS) have increased their price targets to $400, noting strong quarterly results and optimistic future guidance. Loop Capital also raised its price target to $385, maintaining a Buy rating due to monday.com’s robust performance and positive outlook for 2025. Cantor Fitzgerald lifted its price target to $380, highlighting the company’s record low gross churn and strong performance indicators across customer segments.
The company’s fiscal year 2025 guidance includes a revenue growth forecast between 24-27%, with analysts suggesting this may be conservative given potential growth drivers such as AI utilization and new product offerings. The introduction of a consumption-based pricing model for AI Blocks and the launch of Monday Service are seen as strategic moves that could bolster future revenue. Analysts have noted improvements in net dollar retention rates, particularly among high-value customers, and expect continued growth in the company’s market share. These developments underscore monday.com’s strategic focus on expanding its customer base and enhancing its product offerings.
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