William Blair analyst Brian Drab has maintained their bullish stance on KRNT stock, giving a Buy rating today.
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Brian Drab has given his Buy rating due to a combination of factors that suggest potential for future growth despite current challenges. Kornit Digital’s recent financial performance showed some setbacks, with revenue and adjusted EBITDA falling short of expectations. However, the company is addressing these issues, particularly the inventory adjustments that affected consumables revenue, which are expected to stabilize in the latter half of the year.
Furthermore, Kornit’s new business model, particularly the as-impressions-consumed (AIC) initiative, is seen as a promising growth avenue. Although AIC revenue is currently below expectations, the company is making strides in expanding its customer base, especially among screen-printing customers transitioning to digital. The annual recurring revenue from AIC provides visibility into future earnings, and management’s expectations for growth in this area indicate a positive long-term outlook. These factors contribute to Drab’s optimistic view of Kornit’s potential, justifying the Buy rating.
In another report released today, Needham also maintained a Buy rating on the stock with a $25.00 price target.