- Piper Sandler analyst Brent Bracelin maintained Bill.com Holdings, Inc BILL with an Overweight and raised the price target from $205 to $212.
- Float revenue TTM has fallen to $4 million from a peak of $25 million in CY19 but should rebound alongside rising interest rates, as per Bracelin.
- Following the biggest Fed Funds Rate (FFR) hike since 1994, he raised the float revenue estimates for BILL by $16 million for FY23 to $20 million.
- He saw the potential for float revenue to $80 million+ in FY24, factoring in the multi-quarter lag between the realized yields and FFR changes.
- He noted that nominal costs were associated with incremental float revenue, but the impact on the bottom line could be even more meaningful, accelerating the path to profitability.
- The PT reflects higher float revenue and profit estimates.
- He recommended large-cap growth investors continue adding to positions in one of his favorite all-weather growth stocks.
- Price Action: BILL shares traded lower by 5.88% at $106.65 on the last check Thursday.
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