EPAM Systems (EPAM) shares were lowered to Underweight from Equal Weight at Morgan Stanley Thursday, with analysts raising the bank's price target for the stock to $250 from $235 per share.
The bank sees more pricing pressure, slower budget growth, and lower venture capital investment weighing on the stock, making a return to previous growth rates difficult.
"Discretionary spending intentions look unchanged as we believe CY24 IT budgets will likely come in flat," analysts stated. "Checks and company commentary point to pricing pressure."
They added that a period of lower venture capital investment is weighing on the adoption of new technology platforms.
"We are encouraged by EPAM's active expansion efforts, though we remain mindful of competitive pressures in geographies with strong incumbent presence," the analysts concluded.
EPAM shares are down approximately 3.2% Wednesday afternoon, trading around the $288.45 mark.