Truist Securities has initiated coverage on OneStream Inc. (NASDAQ: OS) with a Buy rating and set a price target of $35.00. The firm highlighted OneStream's position as a market-leading cloud platform within the corporate performance management (CPM) market, also known as Office of CFO software.
OneStream is recognized for its innovative and comprehensive platform that encompasses core financial applications. These applications include financial close and consolidation, financial and operational planning and analysis, and financial and operational reporting. The platform also extends to additional finance and operational use cases as well as applied artificial intelligence applications.
Truist Securities believes that OneStream is poised to sustain strong growth at scale and achieve profitability in the near term. The firm also noted the company's already positive free cash flow (FCF), which supports the optimistic outlook for the stock.
InvestingPro Insights
Following Truist Securities' optimistic outlook on OneStream Inc. (NASDAQ:OS), InvestingPro data and tips provide additional context for investors considering the stock. OneStream, with a market capitalization of $6.62 billion, is trading at a high revenue valuation multiple, reflecting the market's high expectations for its growth prospects. The company's revenue for the last twelve months as of Q1 2024 stands at $406.39 million, marking a significant quarterly revenue growth of 39.93%. This rapid growth aligns with Truist Securities' view of OneStream's potential to sustain strong growth at scale.
However, despite the positive revenue figures, OneStream has not been profitable over the last twelve months, which is echoed by an adjusted P/E ratio of -415.67. This metric may raise questions about the company's near-term profitability, a factor that Truist Securities believes the company will achieve. Additionally, OneStream's stock is trading near its 52-week high, with the price at 96.93% of this peak, indicating that the stock is currently favored by the market.
An InvestingPro Tip suggests that the stock generally trades with low price volatility, which could appeal to investors looking for stability in their investment. However, another tip points out that the stock's RSI suggests it is in overbought territory, which could indicate a potential pullback or leveling off in the near future.
For investors seeking a deeper analysis, there are more InvestingPro Tips available at https://www.investing.com/pro/OS, providing further insights into OneStream's financial health and stock performance. These additional tips can help investors make more informed decisions by considering various aspects of the company's financial status and market behavior.
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