MeridianLink (MLNK – Research Report), the Technology sector company, was revisited by a Wall Street analyst yesterday. Analyst Koji Ikeda from Bank of America Securities reiterated a Sell rating on the stock and has a $18.00 price target.
Koji Ikeda has given his Sell rating due to a combination of factors affecting MeridianLink’s financial outlook. The company’s recent quarterly results were mixed, with revenue falling slightly below expectations, although adjusted EBITDA exceeded guidance. The 2025 revenue guidance is also below market consensus, and a notable customer downsell is expected to create a growth headwind. Additionally, the decision to cease providing quarterly guidance reduces visibility into the company’s future performance.
Despite the company’s efforts to invest in long-term growth, these investments are likely to pressure margins in the near term. While new disclosures on revenue model sensitivity to mortgage volumes are a positive step, they also highlight that significant upside may not be realized until there is a substantial increase in mortgage volumes. Furthermore, the valuation of MeridianLink is lower compared to its peers due to the challenging high-interest rate environment impacting its end markets. These factors collectively contribute to the Sell rating.
According to TipRanks, Ikeda is a 5-star analyst with an average return of 12.9% and a 56.91% success rate. Ikeda covers the Technology sector, focusing on stocks such as Datadog, BlackLine, and Dynatrace.
In another report released today, Barclays also maintained a Sell rating on the stock with a $19.00 price target.
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