ON24’s Uncertain Growth Prospects Prompt Hold Rating Amid Promising Developments

William Blair analyst Arjun Bhatia has reiterated their neutral stance on ONTF stock, giving a Hold rating today.

Arjun Bhatia has given his Hold rating due to a combination of factors impacting ON24’s current and future performance. While the company has shown improvements in areas such as customer retention and acquisition, and there are early signs of macroeconomic recovery, these positive developments are not yet sufficient to warrant a more optimistic outlook. The company’s efforts in AI and go-to-market strategies are promising, but further evidence of sustained top-line growth is needed.
Despite ON24 trading at a discount compared to other software stocks, the uncertainty surrounding its path to consistent growth remains a concern. The potential risks, including customer spending rationalization, increased churn, limited profitability, and competitive pressures, contribute to the cautious stance. As a result, Arjun Bhatia maintains a Hold rating, awaiting more definitive signs of stabilization and growth.