UPDATE: Stifel Nicolaus Initiated Demandware at Hold on Valuation, Macro Environment
Stifel Nicolaus initiated coverage on Demandware (NYSE: DWRE) with a Hold rating.
Stifel Nicolaus said, "We believe DWRE is uniquely positioned to monetize a very large (multi-billion), growing (15% CAGR), and under-penetrated (<5%) market. We also expect the company to benefit from numerous secular trends (shift to online shopping, increased adoption of cloud solutions, re-platforming to latest e-commerce offerings) and company specific growth drivers (growing customer base, further pentrating install base, entering new markets, etc.), which should enable it to deliver >30% subscription revenue for the foreseeable future. Although we believe Demandware's fundamentals are solid and believe it is well positioned to close FY12 on a solid note, given a healthy valuation, the current macro environment, and some potential growing pains, we would wait for a pullback to get more constructive on the name."
Demandware closed at $24.64 on Monday.
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