Analysts React To Qualtrics' Q2 Results

Analysts continue to exude confidence in Qualtrics International Inc XM with a hint of caution despite dismal Q3 guidance.
JMP Securities analyst Patrick Walravens maintained its Market Outperform rating and $28 price target on Qualtrics after the company reported mixed Q2 results.
The results reflected Qualtrics seeing some deals take longer in the macroeconomic environment, with the non-GAAP EPS missing the consensus. The guidance was mixed.
However, he saw the deteriorated macro and IT spending already discounted in the current price.
He still adopted a conservative approach to 2023 by applying the Q4 growth rate of 18% for total revenue to the entire next year.
He liked the ~$60 billion experience management market addressed by Qualtrics and thinks its software can help its customers as the global economy battled inflation, war, supply chain disruption, and higher interest rates.
He cut his 2022, 2023, and 2024 non-GAAP EPS estimates.
BMO Capital analyst Keith Bachman reiterated Outperform based on confidence in XM's tech platform and valuation. Bachman reduced the price target to $14.50 from $16.00. A few days back, Bachman reduced XM's price target to $16 from $32.
XM remained in his Tier 3 (lowest level) of Outperform stocks.
He acknowledged that XM has a history of beating revenue guidance (meaning conservative guides), but he saw the macro is impacting the outlook, as it will for his coverage universe.
Management stated not seeing cancellations, which he considered a vote of confidence on the value derived from XM's solutions by existing customers and reflected the stickiness of the platform.
Price Action: XM shares traded lower by 4.23% at $13.13 on the last check Thursday.

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Analysts React To Qualtrics' Q2 Results