Smartsheet And Asana's Contrasting Q4 Forecast Amid Macro Headwinds Surprises Analyst

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  • KeyBanc analyst Jason Celino reiterated an Overweight rating on Smartsheet Inc SMAR with a $46 price target.
  • Celino maintained a Sectorweight rating on Asana, Inc ASAN. The analyst sees fair value at $16 based on 5x FY24E EV/revenue.
  • Work management peers Smartsheet and Asana reported starkly different Q3 results. 
  • SMAR reported a solid Q3 beat and better Q4 guidance, while ASAN posted mixed results and lowered Q4 guidance. 
  • Smartsheet reported third-quarter revenue growth of 38% year-on-year to $199.6 million, beating the consensus of $194.3 million.
  • Non-GAAP EPS loss of $(0.01) beat the consensus loss of $(0.15).
  • Smartsheet sees Q4 revenue of $205 million - $207 million (vs. consensus $204.4 million), non-GAAP EPS loss of $(0.02) - $(0.00) (vs. consensus loss $(0.09)).
  • Asana's Q3 revenue increased 41% year-over-year to $141.4 million, beating the consensus of $139.37 million. 
  • Non-GAAP EPS loss of $(0.26) beat the consensus loss of $(0.32).
  • Asana expects Q4 revenue to be $144 million - $146 million versus average estimates of $151.06 million. The company anticipates a non-GAAP EPS loss of $(0.27) - $(0.28) versus a consensus loss of $(0.29).
  • Though both companies mentioned worsening macro, SMAR looks to be executing well, with ASAN facing incremental challenges given the company's exposure to tech and more limited cross-sell go-to-market. 
  • Price Action: SMAR shares traded higher by 15.26% at $37.47 on the last check Friday.
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