PagerDuty (PD – 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 impacting PagerDuty’s financial outlook. Despite reporting favorable fourth-quarter results with revenue and non-GAAP operating income surpassing expectations, the company’s guidance for fiscal year 2026 presents a mixed picture. The projected revenue growth of 7.0% to 8.4% falls short of market expectations, and while the non-GAAP EPS guidance is slightly above consensus, the overall revenue growth remains in the single digits, suggesting limited near-term catalysts.
Additionally, while there are positive indicators such as increased adoption of multi-product offerings and a new stock buyback program, other metrics like billing growth and net retention rate have shown signs of slowing. The company’s ability to expand free cash flow margins is commendable, but the overall growth trajectory remains modest compared to its peers. These factors contribute to the reiterated Underperform rating and a price objective of $18, reflecting a cautious outlook on PagerDuty’s future performance.