C3.ai (AI), a company that builds artificial intelligence software for large enterprises, is exploring the possibility of selling itself, according to Reuters. This comes after founder Thomas Siebel stepped down as CEO due to health issues involving an autoimmune disease that impaired his vision. However, the potential sale is still in its early stages, and other ideas, such as raising private investment, are also being discussed. The company hasn’t commented publicly on these developments.
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Interestingly, C3.ai is considered a smaller competitor to Palantir (PLTR) in government, energy, and manufacturing sectors. Financially, C3.ai has faced growing challenges. More precisely, the company’s market value is around $2.15 billion, but its stock has dropped over 54% this year. Moreover, in the quarter ending July 31, it reported a net loss of $116.8 million and a 19% drop in revenue to $70.3 million compared to the same quarter a year earlier.
Then, in September, C3.ai withdrew its full-year financial forecast, citing the CEO change and a reorganization of its sales and service divisions as the reasons. Therefore, these setbacks have added pressure on the company to consider new strategic paths. Leadership changes have also added more uncertainty. In fact, Salesforce (CRM) veteran Stephen Ehikian became CEO on September 1, after Siebel moved into an executive chairman role in July.
Is C3.ai Stock a Good Buy?
Turning to Wall Street, analysts have a Hold consensus rating on AI stock based on two Buys, six Holds, and five Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average C3.ai price target of $15.55 per share implies 3.3% downside risk.
