TD Cowen analyst Derrick Wood has maintained their neutral stance on TEAM stock, giving a Hold rating on April 14.
Derrick Wood’s rating is based on Atlassian’s recent financial performance and market dynamics. The company reported a 14% revenue growth for the third quarter, which was in line with expectations but showed a smaller beat compared to the previous quarter. This was partly due to larger deals being delayed more than anticipated, although Atlassian does not attribute this to macroeconomic factors. The company’s focus on expanding enterprise sales and integrating AI to enhance product offerings is a positive sign for future growth.
However, there are some areas of concern that justify the Hold rating. Atlassian’s billings growth was below market expectations, and the addition of new high-value customers showed a year-over-year decline. While the company’s operational margin was better than expected, it still experienced a slight year-over-year decline. Despite these challenges, Atlassian’s long-term growth targets remain unchanged, but the company will need to demonstrate a strong recovery in the next quarter to boost investor confidence. Therefore, the Hold rating reflects a cautious stance, awaiting further evidence of growth momentum.
Wood covers the Technology sector, focusing on stocks such as Confluent, Oracle, and Adobe. According to TipRanks, Wood has an average return of 11.9% and a 54.64% success rate on recommended stocks.
In another report released on April 14, Stephens also reiterated a Hold rating on the stock with a $255.00 price target.