Deutsche Bank raised its price target for Bill.com (NYSE:BILL) shares to $140 from $110, reiterating a Buy rating in a note Thursday.
Deutsche analysts told investors the upgrade is due to higher peer group valuations and improving fundamental outlook. In addition, they state that BILL's TPV trajectory appears to have stabilized and looks to be tracking slightly above our current estimates.
"Importantly, BILL remains in the early stages of its SMB B2B penetration journey, and we believe expectations are sufficiently conservative in both 4Q23 and FY24," the analysts wrote.
"Despite a muted volume recovery, we believe BILL's ad valorem payment rates can continue to expand and that adj. operating margins will surprise to the upside over the next few years."
Deutsche Bank sees BILL conservatively guiding to FY24 revenue growth of ~24-27% YoY with the potential for adjusted operating margins "to come in well above Street expectations."