RBC Capital analyst Matthew Hedberg reiterates GitLab Inc (NASDAQ:GTLB) with an Outperform and a $80 price target.

On Monday, GitLab reported fourth-quarter revenue of $163.78 million, up by 33.3% year-on-year, beating the analyst consensus estimate of $158.21 million. The company clocked EPS of $0.15, which beat the analyst consensus estimate of $0.08. The stock price plunged after the results.

GitLab projected first-quarter revenue of between $165 million – $166 million, versus the $161.86 million estimate, and full-year 2025 revenue of between $725 million – $731 million, versus the $731.67 million estimate. It expects first-quarter EPS of between $(0.05) – $(0.04), versus the $0.06 estimate and fiscal year 2025 EPS of $0.19 – $0.23, below the $0.35 consensus estimate.

The analyst noted that despite the strong quarter, fiscal 2025 guidance was mixed, with management calling out a “less conservative” guidance philosophy. While he expects lower beats than historical levels, there is room for upside to estimates driven by the premium price increase and better-than-expected contributions from new products.

Hedberg projects first-quarter revenue and EPS of $165.5 million (prior $159.0 million) and $(0.05) (prior $0.01).

DA Davidson analyst Gil Luria maintained GitLab with a Neutral and lowered the price target from $75 to $65.

The analyst said that GitLab reported a good quarter driven by improved buying behavior across its customer base, especially within its enterprise customer base. 

Record levels of large deals highlighted the quarter, and GitLab’s numerous growth drivers show up in its forward-looking metrics.

However, the setup into fiscal 2025 on revenue was a tough hurdle, and guidance came short of consensus expectations, sending the stock down. According to management, the re-rating reflects that the upside to revenue will take time to materialize.

Luria projects first-quarter revenue and EPS of $166.0 million (prior $161.8 million) and $(0.03).

Canaccord Genuity analyst Kingsley Crane reiterated GitLab with a Buy and a $74 price target.

The analyst said that GitLab remains one of the best growth-adjusted plays in infrastructure software, with a 130% NRR. 

Yes, guidance is not so conservative that he expects 10%+ top-line beats each quarter, but he still sees a pathway for the company to finish fiscal 2025 with growth in the high 20s vs. the ~25% Y/Y implied by guidance.

While not immune to the seat-based growth pressures felt by software peers, the company is seeing traction with a) upselling into Premium and Ultimate bundles, b) powerful initial traction with Duo Pro, and c) diversification into net-new user segments with multiple products targeting security practitioners plus Agile Planning serving product manager personas. 

The secular shift toward a handful of true DevOps platforms like GitLab and an ongoing investment prioritization in application development and developer tools are creating tangible, multi-year tailwinds for which GitLab is well positioned.

Crane projects first-quarter revenue and EPS of $166.0 million and $(0.05).

Mizuho analyst Gregg Moskowitz maintained GitLab with a Buy and lowered the price target from $87 to $75.

The analyst shared investors’ disappointment and surprise regarding the guidance. Nevertheless, he noted GitLab is oversold and remained confident in its ability to grow due to AI monetization, his view that management’s estimate of a $10 million – $20 million fiscal 2025 revenue impact from pricing is conservative, and his research indicates healthy upsell potential. 

Moskowitz projects first-quarter revenue and EPS of $165.8 million (prior $163.3 million) and $(0.04) (prior $0.09).

Investors can gain exposure to GitLab via Tidal ETF Trust II Pinnacle Focused Opportunities ETF (NYSE:FCUS) and Innovator IBD 50 ETF (NYSE:FFTY).

Price Action: GTLB shares traded lower by 20.60% at $59.15 on the last check Tuesday.

Photo by T. Schneider via shutterstock