HubSpot (HUBS – Research Report), the Technology sector company, was revisited by a Wall Street analyst today. Analyst Brent Bracelin from Piper Sandler downgraded the rating on the stock to a Hold and gave it a $640.00 price target.
Brent Bracelin has given his Hold rating due to a combination of factors influencing HubSpot’s current market position. The company demonstrated strong performance in the third quarter, achieving a 3.6% revenue beat with 20% subscription growth, suggesting resilience in a challenging environment. However, despite these positive results, HubSpot’s shares have appreciated significantly by 33% over the past three months, outpacing the S&P 500’s 13% rise, which indicates that the stock may be fairly valued at its current trading multiples.
Furthermore, while the company’s operating margins improved to 18.7% due to various optimizations and a one-time benefit, the upward revision of the price target to $640 seems to balance out these improvements with the current valuation concerns. The stock is now trading at 50 times its estimated 2026 enterprise value to free cash flow (EV/FCF), making it more challenging to justify an Overweight rating. Therefore, the Hold rating reflects a cautious stance as investors weigh the potential risks and rewards in the context of HubSpot’s growth trajectory and valuation metrics.
Bracelin covers the Technology sector, focusing on stocks such as Salesforce, Adobe, and HubSpot. According to TipRanks, Bracelin has an average return of -5.6% and a 40.36% success rate on recommended stocks.
In another report released on October 23, Evercore ISI also maintained a Hold rating on the stock with a $610.00 price target.
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HubSpot (HUBS) Company Description:
HubSpot, Inc. provides cloud-based marketing and sales software platform that enables businesses to deliver an inbound experience. It operates through the following geographical segments: Americas, Europe, and Asia Pacific. The company was founded by Brian Halligan and Dharmesh Shah on April 4, 2005 and is headquartered in Cambridge, MA.
