In a report released yesterday, Koji Ikeda from Bank of America Securities reiterated a Sell rating on BigCommerce Holdings (BIGC – Research Report), with a price target of $6.00.
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Koji Ikeda’s rating is based on a combination of factors including the underwhelming revenue guidance provided by BigCommerce Holdings for 2025. The company reported good results for the fourth quarter of 2024, but its projected revenue growth for 2025 is only 4% year-over-year, which is a significant deceleration from the 7.6% growth in 2024. This growth rate is below the expectations of the market and peers, indicating potential underperformance for the stock.
Furthermore, while the company has made strategic shifts in leadership and market focus, and is aiming for profitable growth, its current profile of revenue growth plus operating margin is considerably lower than that of its small-cap competitors. The valuation of BigCommerce is at a 35% discount compared to its peers, which reflects the slower growth and execution risks associated with the company’s recent strategic changes. Until these growth and margin metrics improve substantially, the stock is expected to underperform, justifying the Sell rating.
Ikeda covers the Technology sector, focusing on stocks such as Datadog, nCino, and BlackLine. According to TipRanks, Ikeda has an average return of 16.9% and a 61.10% success rate on recommended stocks.
In another report released today, Barclays also maintained a Sell rating on the stock with a $7.00 price target.