Market Overview

For LogMeIn, It's All About The Free Cash Flows

Share:
  • The share price of LogMeIn, Inc. (NASDAQ: LOGM) has risen more than 49 percent over the past year, rising over 31 percent year-to-date.
  • Ben McFadden of Pacific Crest Securities has upgraded LogMeln to Overweight, with a price target of $82.
  • The upgrade reflects increased confidence in the company’s ability to grow its traditional businesses, as well as the “opportunity to take join.me to the enterprise.”

McFadden also believes that the recent pullback in the stock offers a compelling buying opportunity, especially given that the company’s growth has been better than anticipated.

“LogMeIn has seen strong up-sells and renewals after discontinuing stand-alone LogMeIn Free, which is driving recent billings strength, and we are increasingly confident in the run-rate of the company's more traditional businesses such as Rescue, Boldchat and LogMeIn Pro,” according to the Pacific Crest report.

McFadden also expects Central to continue to face tailwinds related to the recent shift to more tiered pricing. In addition, McFadden believes that the run-rate growth of LogMeln’s core businesses, expected in the low to mid teens, would prove positive for investors.

In addition, join.me has been rapidly ramping, and is expected to deliver growth of more than 80 percent year-on-year in 2015. McFadden mentioned that this business “is just beginning to tap into the enterprise opportunity, which is much larger.”

LogMeln is expected to add more functionality to join.me, such as video, which could drive higher growth, with join.me, Xively and other emerging offerings accounting for almost 20 percent of the company’s revenue by 2H2016 and adding more than 6 percent in incremental growth for the total revenue in 2016.

McFadden expects LogMeln’s robust free cash flow to drive the shares higher, going forward.

Latest Ratings for LOGM

DateFirmActionFromTo
Oct 2019Initiates Coverage OnBuy
Aug 2019AssumesEqual-Weight
Apr 2019DowngradesOverweightUnderweight

View More Analyst Ratings for LOGM
View the Latest Analyst Ratings

Posted-In: Ben McFadden Pacific Crest SecuritiesAnalyst Color Upgrades Analyst Ratings

 

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Latest Ratings

StockFirmActionPT
ELMDDougherty & Co.Initiates Coverage On12.0
MRNSCantor FitzgeraldAssumes7.0
MNRLCapital One FinancialInitiates Coverage On23.0
SONVertical GroupUpgrades
UNPMorgan StanleyMaintains136.0
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