In a report released today, Eric Martinuzzi from Lake Street maintained a Hold rating on Olo, with a price target of $10.25.
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Eric Martinuzzi has given his Hold rating due to a combination of factors surrounding Olo’s recent acquisition announcement. The company is set to be acquired by Thoma Bravo for $10.25 per share, which aligns with the new price target set by Martinuzzi. This acquisition values Olo at an enterprise value of 4.2 times its estimated 2025 revenue, a valuation that some may question given the company’s growth prospects.
Despite Olo’s strong growth in transaction volumes, particularly in its Pay product, the overall growth in its non-Pay subscription offerings is estimated to be modest. The acquisition by Thoma Bravo, a firm known for its expertise in tech and SaaS investments, is seen as a positive move, but the dual class share structure and the break-up fee add complexity to the deal. These factors contribute to the decision to rate the stock as Hold, reflecting a cautious approach given the current circumstances.
Martinuzzi covers the Technology sector, focusing on stocks such as Olo, Asure, and DHI Group. According to TipRanks, Martinuzzi has an average return of 12.1% and a 51.33% success rate on recommended stocks.