Piper Sandler analyst Brent Bracelin maintained an Overweight rating on Coupa Software Inc (NASDAQ: COUP) and cut the price target from $300 to $295, implying a 30.48 percent upside.
Given the Coupa Pay penetration objective of 10% for FY21 versus bullish expectations of 25%, Bracelin believes Coupa’s first analyst day since 2019 may upset the Coupa Pay bulls.
He, on the other hand, sees the objective as modest, with plenty of space for growth.
However, he believes that the announcement will put a stop to further multiple expansion until other growth catalysts emerge.
Following the analyst day, Morgan Stanley analyst Stan Zlotsky decreased Coupa’s price objective to $345 from $381, representing a 52.59 percent upside, but maintaining an Overweight rating.
According to Zlotsky, Coupa management typically sketched out the broad strokes of monetizing its embryonic Pay business sector and established fairly conservative forward projections.
He’s lowering his aim by modifying his Coupa Pay forecasts across the board to better correspond with management’s targets.
Coupa’s core company ex-Pay value of $200 per share, on the other hand, means that the core business accounts for roughly 90% of the stock’s value at current levels, leaving Pay as the X-factor.
Coupa’s analyst day disclosures on Coupa Pay’s total addressable market and the anticipated ramp of Pay adoption appear lower than investors’ expectations, according to Mizuho analyst Siti Panigrahi, which caused yesterday’s stock selloff.
Panigrahi maintains a Neutral rating on the stock, preferring to wait for Coupa Pay’s payback before purchasing. Coupa closed yesterday at $226.09, down 10%.
Coupa highlighted various long-term goals during the analyst day, including an 80 percent to 82 percent gross margin objective and a 25 percent to 30 percent operating margin target.
COUP shares fell 2.91 percent to $219.50 during the market session on Friday, according to the most recent check.
COUP DateFirmActionFromJuly 2021 Latest Ratings
Morgan Stanley is a financial services firm based in
Jul 2021: Maintains Overweight
Piper Sandler Maintains Her Overweight Status Until July 2021
KeybancMaintainsOverweight
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