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On Friday, Truist Securities increased its price target for shares of Manhattan Associates, Inc. (NASDAQ:MANH) to $310 from the previous $275, while maintaining a Buy rating on the stock. The firm highlighted Manhattan Associates' reinforced standing as a strategic supplier for significant transformation projects in warehouse management systems (WMS), transportation management systems (TMS), order management systems (OMS), and other areas.
The analyst from Truist Securities noted that Manhattan Associates is well-positioned to capitalize on larger point-of-sale opportunities and the recent release of its supply chain planning product, which is expected to contribute to the company's revenue and cloud bookings growth. Despite shares appearing expensive when looking at 2025 multiples, the firm justifies its Buy rating and valuation based on the anticipation of continued "beat-and-raise" dynamics.
Furthermore, the firm's valuation analysis is supported by the attractive long-term potential for sustained compound growth in cloud subscription revenue and free cash flow (FCF). The increase in the price target to $310 is based on higher discounted cash flow (DCF) assumptions.
Manhattan Associates' strategic positioning and product offerings suggest a positive outlook for the company's financial performance. The firm's analysis indicates confidence in the company's ability to maintain its growth trajectory and deliver value to its shareholders.
In other recent news, Manhattan Associates has been making headlines with its strong financial performance and optimistic outlook. The company recently reported a 15% surge in total revenue to $265 million and a 34% rise in adjusted earnings per share to $1.18. The company's cloud revenue, a significant growth area, expanded by 35%, and services revenue increased by 10%.
Furthermore, Manhattan Associates' Remaining Performance Obligations (RPO) grew by 29%, while subscription revenue saw a 35% increase, surpassing the projected 33% growth. These positive developments have been attributed to its robust Warehouse Management Systems (WMS), high competitive win rates, and effective sales execution strategies.
Despite some irregularities leading to delayed deals, Loop Capital maintains a Buy rating on the shares and has increased the price target for Manhattan Associates to $265.00, up from the previous $250.00. The company's commitment to innovation is evident in the introduction of new products such as Manhattan Active Maven and Manhattan Active Supply Chain Planning.
Looking ahead, Manhattan Associates expects full-year 2024 revenue to fall between $1.036 billion and $1.044 billion, representing a growth of 17%. The company remains confident in achieving its bookings goals for the year.
InvestingPro Insights
Recent data from InvestingPro aligns with Truist Securities' bullish outlook on Manhattan Associates (NASDAQ:MANH). The company's market cap stands at $18.01 billion, reflecting its significant presence in the supply chain management software sector. MANH's revenue growth of 17.49% over the last twelve months as of Q2 2024 supports the analyst's view on the company's expanding market opportunities.
InvestingPro Tips highlight that 7 analysts have revised their earnings upwards for the upcoming period, suggesting growing confidence in MANH's financial performance. This aligns with Truist Securities' expectation of continued "beat-and-raise" dynamics. Additionally, the stock is trading near its 52-week high, with a strong return of 21.91% over the last three months, indicating positive market sentiment.
However, investors should note that MANH is trading at a high P/E ratio of 88.29, which corroborates the analyst's observation about the stock appearing expensive. This valuation metric underscores the importance of the long-term growth potential emphasized in the Truist Securities report.
For readers interested in a deeper analysis, InvestingPro offers 15 additional tips for Manhattan Associates, providing a comprehensive view of the company's financial health and market position.
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