Bullish indicating open at $55-$60, IPO prices at $37
Investing.com-- Stifel analysts cut their target price on HubSpot Inc (NYSE:HUBS), but maintained their Buy rating on the software developer as it prepares to report its second-quarter earnings in the coming weeks.
Stifel cut HUBS’ target price to $700 from $750, and maintained its Buy rating on the stock.
The brokerage said that talks with HUBS partners showed greater-than-expected adoption of the company’s enterprise software services in the second quarter.
Stifel said that focus during the Q2 earnings will be squarely on the adoption of HUBS’ artificial intelligence agent service, especially the potential impact AI will have on seat counts.
But real-time feedback on AI agents appeared mixed, especially given that only a customer agent service was currently available.
Stifel said HUBS’ custom acquisition remained a bright spot for the company, despite a minor deceleration in total customer count growth and a pullback from net-add figures seen between Q4 2023 and Q2 2024.
“Plenty of tailwinds remain for customer acquisition, such as a TAM that remains large, growing, and under-penetrated, products outside of Marketing Hub increasingly becoming a front door to the platform, and the potential for AI advancements to accelerate mind share and adoption,” Stifel analysts wrote in a note.
Sentiment around HUBS’ average subscription revenue per customer is expected to improve, while net revenue retention is expected to remain steady.
HUBS and other enterprise software companies are expected to have benefited from increasing AI adoption in the corporate sector, with focus specifically on the use of AI agents– AI bots which are able to operate somewhat autonomously in carrying out specialized tasks.