Backblaze (BLZE – Research Report), the Technology sector company, was revisited by a Wall Street analyst on April 25. Analyst Eric Martinuzzi from Lake Street reiterated a Buy rating on the stock and has a $11.00 price target.
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Eric Martinuzzi has given his Buy rating due to a combination of factors that suggest the current market reaction to Backblaze’s stock is an overreaction. Despite the allegations of accounting malpractice highlighted in the Morpheus short report, Martinuzzi finds these claims to be unsubstantiated. The accusations largely rely on statements from lawsuits by former employees, which have been investigated and dismissed by Backblaze’s board.
Furthermore, Martinuzzi points out that the company’s financial practices, such as capitalizing software development expenses, are consistent with industry norms, especially given Backblaze’s size compared to its larger peers. The company’s auditor, BDO, has consistently signed off on its financial statements without raising concerns. Additionally, the recent decline in stock price is not unique to Backblaze but is a common trend among tech IPOs from 2021. These factors, combined with the current share price pullback, present a buying opportunity, leading to Martinuzzi’s Buy rating.
BLZE’s price has also changed moderately for the past six months – from $7.200 to $4.510, which is a -37.36% drop .