ON24 (ONTF – Research Report), the Technology sector company, was revisited by a Wall Street analyst yesterday. Analyst David Hynes from Canaccord Genuity maintained a Hold rating on the stock and has a $9.00 price target.
David Hynes’s rating is based on a combination of factors that reflect both the challenges and opportunities facing ON24. Despite some positive indicators such as the highest level of new and expansion business for the year and significant contributions from AI-driven ACE, the company continues to face downsell pressure. This pressure stems from clients adjusting their investments post-COVID and exploring more cost-effective alternatives, which has impacted ON24’s growth trajectory.
Management is optimistic about returning to positive growth in 2025, with expectations of 1-2% growth later in the year. However, retention rates, although improved, still suggest caution. ON24’s premium pricing in a competitive market with tight marketing budgets further complicates its growth prospects. While the company has made strides towards profitability and laid plans for future growth, the current environment suggests that maintaining a Hold rating is prudent until more consistent progress is evident.
ONTF’s price has also changed slightly for the past six months – from $6.430 to $5.790, which is a -9.95% drop .