Market Overview

Oppenheimer Praises HubSpot's Execution, Downgrades On Valuation

Share:
Oppenheimer Praises HubSpot's Execution, Downgrades On Valuation

Although HubSpot Inc (NYSE: HUBS) is a great business with an excellent track record of execution, the stock is now trading at a significant premium to peers and already reflects the company’s future success, according to Oppenheimer.

HubSpot shares have appreciated around 225 percent since January 2017, versus an average gain of about 110 percent for the OpCo SaaS group and around 30 percent for the NASDAQ.

The Analyst

Oppenheimer’s Koji Ikeda downgraded HubSpot from Outperform to Perform and removed a $160 price target. 

The Thesis

HubSpot seems to be tracking toward strong Q4 results, but could face weakness in SMB demand in 2019, Ikeda said in the Thursday downgrade note. 

“Our recently published Annual IT Survey and SMB industry data from the NFIB suggest a potentially less certain and softening SMB buyer mindset in 2019, which slightly raises estimate risk, we think,” the analyst said. 

Software vendors have made huge investments in the customer engagement category, Ikeda said. Some have expanded their product portfolios, which compete directly with HubSpot.

Vendors like salesforce.com, inc. (NYSE: CRM) are encroaching on HubSpot's target market, the analyst said, adding that these developments could impact customer acquisition and retention.

Price Action

HubSpot shares were trading down 1.61 percent at $149.57 at the time of publication Thursday. 

Related Links:

Bank Of America Raises HubSpot Price Target After Positive Channel Checks

Jefferies: 3 Software Players To Watch

Photo courtesy of HubSpot. 

Latest Ratings for HUBS

DateFirmActionFromTo
Jan 2021Wells FargoUpgradesEqual-WeightOverweight
Nov 2020KeyBancInitiates Coverage OnOverweight
Nov 2020UBSMaintainsNeutral

View More Analyst Ratings for HUBS
View the Latest Analyst Ratings

 

Related Articles (HUBS)

View Comments and Join the Discussion!

Posted-In: Koji Ikeda OppenheimerAnalyst Color Downgrades Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
MRTXHC Wainwright & Co.Maintains257.0
NVDATruist SecuritiesMaintains672.0
NVDASusquehannaMaintains625.0
BLKBMO CapitalMaintains715.0
BLKDeutsche BankMaintains838.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com