Needham analyst Kyle Peterson reiterated a Buy rating on Alight today and set a price target of $6.00.
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Kyle Peterson has given his Buy rating due to a combination of factors that highlight Alight’s potential despite recent challenges. The company reported strong second-quarter results, surpassing expectations in terms of revenue and earnings, which were driven by robust recurring revenue growth and effective management of operating expenses. However, the outlook for fiscal year 2025 revenue was adjusted downward, attributed to extended deal cycles, which contributed to a decline in share prices.
Kyle Peterson remains optimistic about Alight’s future, as the company reaffirmed its guidance for EBITDA, EPS, and free cash flow. Additionally, a new partnership with Goldman Sachs Asset Management was announced, enhancing Alight’s offerings on its Worklife platform. Although the near-term growth outlook appears subdued, there is confidence in Alight’s ability to achieve its mid-term growth targets, as outlined earlier this year. Therefore, the Buy rating is maintained, albeit with a revised target price of $6.
Peterson covers the Technology sector, focusing on stocks such as Fair Isaac, Alight, and Affirm Holdings. According to TipRanks, Peterson has an average return of 5.6% and a 45.64% success rate on recommended stocks.