Too Many Subscriptions? Here's Why An Analyst Is A Buyer Of The Trend To Cut Bills

Loading... Holdings Inc BILL has a first-mover advantage in accounts payable (AP) and accounts receivable (AR) automation for small and mid-sized businesses (SMBs), according to Morgan Stanley.

The Analyst: Keith Weiss initiated coverage of with an Overweight rating and price target of $220.

The Thesis: The Divvy and Invoice2go acquisitions add expense management and accounts receivable automation to the company’s core AP automation offering, Weiss said in the initiation note.

The acquisitions expand’s serviceable addressable market to approximately $80 billion, he added.

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“A compelling value proposition, differentiated go-to-market strategy through direct sales, accounting partnerships, and financial institution partners, supporting a +65% revenue CAGR (CY21–CY23E), the second fastest in our coverage, and a solid track record of execution create a favorable risk/reward for BILL,” the analyst wrote.

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“Our forecasts contemplate 10% total customer CAGR from CY22–CY32, which, in addition to a mid-single digit ARPU CAGR, higher total payment volume (TPV), and greater customer deposits, helps support our 40%+ CAGR over the next five years,” he further stated.

BILL Price Action: Shares of had risen by 0.76% to $168.67 at the time of publication on Monday.

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Posted In: Analyst ColorInitiationAnalyst RatingsKeith WeissMorgan Stanley