Endava (DAVA – Research Report), the Technology sector company, was revisited by a Wall Street analyst today. Analyst Bryan Bergin from TD Cowen downgraded the rating on the stock to a Hold and gave it a $17.00 price target.
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Bryan Bergin has given his Hold rating due to a combination of factors affecting Endava’s current and future performance. The company has faced a challenging period with disappointing third-quarter results and a reduced outlook for the fourth quarter, leading to skepticism about its near-term growth potential. Despite a strong pipeline and pursuit of large deals, the conversion of these opportunities is expected to be slow due to macroeconomic volatility affecting client behavior.
Furthermore, Endava’s revenue and earnings estimates have been significantly reduced, reflecting limited recovery prospects in the coming fiscal years. The company’s performance relative to its peers is also a concern, as other firms in the sector demonstrate more stability and growth potential, making them more attractive to investors. This extended recovery road and lack of clear catalysts for faster improvement contribute to the Hold rating, as investors may seek alternatives with more immediate growth opportunities.
In another report released today, Bank of America Securities also reiterated a Hold rating on the stock with a $20.00 price target.