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Howard Justyn Russell, Executive Chair at Sprout Social, Inc. (NASDAQ:SPT), recently sold 40,000 shares of the company's Class A common stock. The shares were sold at a weighted average price of $19.99, generating a total of approximately $799,599. The sale price aligns closely with the current trading price of $19.93, near the stock's 52-week low of $19.21. According to InvestingPro analysis, the stock appears undervalued at current levels, despite falling 63.83% over the past year. This transaction occurred on April 4, 2025, as part of a 10b5-1 trading plan that Russell adopted in September 2024.
Following the sale, Russell retains ownership of 7,417 shares of Class A common stock. Additionally, he holds a significant number of Class B common stock shares through various trusts, which provide him with substantial voting power within the company. The company maintains impressive gross profit margins of 77.48% and has received upward earnings revisions from 7 analysts for the upcoming period. Discover more insights with InvestingPro, which offers 13 additional investment tips for SPT.
The sale was part of a broader series of transactions, including the conversion of 40,000 Class B shares to Class A shares, which did not involve any cash exchange. This activity reflects Russell's ongoing management of his holdings in Sprout Social, a company known for its prepackaged software services, with a current market capitalization of $1.15 billion.
In other recent news, Sprout Social Inc . has been the subject of several analyst adjustments following its latest financial disclosures. The company reported a slowdown in revenue growth for the fourth quarter of 2024, with year-over-year growth decreasing to 14%, compared to 34% in the same quarter of the previous year. This has led to a series of revised price targets from analysts, with Scotiabank (TSX:BNS) lowering its target to $25 and maintaining a Sector Perform rating, while Stifel reduced its target to $34 but kept a Buy recommendation. Cantor Fitzgerald also adjusted its price target to $38, maintaining an Overweight rating, reflecting a nuanced view of the company's valuation.
Goldman Sachs further revised its target to $29, citing the company's shift towards serving larger markets as a factor in its cautious outlook. Meanwhile, KeyBanc has maintained an Underweight rating with a price target of $23, expressing skepticism about the company's near-term performance. Sprout Social's fiscal year 2025 revenue guidance has been a focal point, with projections set at 11% growth, which falls short of analyst expectations.
Despite the challenges, the company has shown strong performance in areas such as annual recurring revenue (ARR) and enterprise segment momentum. Analysts have noted management's strategic focus on product development and market positioning, with hopes for potential improvements in growth metrics. The market will closely monitor Sprout Social's ability to navigate these challenges and align its performance with investor expectations.
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