TD Cowen sees Samsara stock growth as ARR hits $1.25B+

On Friday, Samsara Inc (NYSE: NYSE:IOT) saw its price target increased to $46.00 from $45.00 by TD Cowen, with the firm maintaining a Buy rating on the stock.

The revision comes after Samsara reported a robust second quarter, achieving a 37% increase in revenue without any quarter-over-quarter deceleration, surpassing Wall Street's expectations of 32%.

The improved financial performance was attributed to heightened activity among large customers and the adoption of multiple products. This led to a notable improvement in the metric for net new customers contributing over $100,000, which saw a strong recovery from the first quarter.

TD Cowen highlighted Samsara's ability to sustain growth rates in the upper 30% range as it scales to an annual recurring revenue (ARR) exceeding $1.25 billion, a performance considered exceptional in the software sector.

The analyst from TD Cowen expressed confidence in the company's trajectory, stating, "Sustaining upper 30% growth even as it scales to $1.25b+ in ARR continues to be in rare air in software. Reiterate Buy. PT to $46." This endorsement underlines the firm's positive outlook on Samsara's growth prospects and market position.

Samsara's strong second-quarter performance, combined with the increased price target and sustained Buy rating from TD Cowen, is likely to bolster investor confidence in the company's stock. The firm's analysis suggests that Samsara is maintaining a robust growth pace, which is a significant achievement for a company expanding its ARR beyond the billion-dollar mark.

In other recent news, Samsara Inc. delivered a robust performance in its second quarter of fiscal year 2025, surpassing both analyst and market expectations. The company reported an adjusted earnings per share of $0.05, exceeding the consensus estimate of $0.01. Additionally, Samsara's revenue for the quarter reached $300.2 million, surpassing the anticipated $289.53 million, marking a 37% year-over-year increase.

The company's Annual Recurring Revenue (ARR), a vital performance indicator, also saw significant growth, reaching $1.26 billion, a 36% year-over-year rise. This strong performance led Truist Securities to increase Samsara's price target from $35 to $40, while maintaining a hold rating on the stock.

Samsara also reported a 41% year-over-year growth in its customer base, with 2,133 customers having an ARR over $100,000. For the third quarter of fiscal 2025, Samsara projects an EPS between $0.03 and $0.04, and revenue in the range of $309-311 million, slightly above analyst expectations. These recent developments reflect Samsara's strong financial trajectory and potential for sustained growth.

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