In a report released today, Scott Buck from H.C. Wainwright maintained a Hold rating on Phunware (PHUN – Research Report), with a price target of $3.00.
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Scott Buck has given his Hold rating due to a combination of factors impacting Phunware’s current and future performance. The company reported a modest revenue increase in 1Q25, which was a positive sign, but the overall revenue remains low at $0.7M. While Phunware has a strong cash position of approximately $110M, which could be used for mergers and acquisitions to drive future growth, there are concerns about the company’s long-term strategic visibility and the faster growth of operating expenses compared to revenue.
Additionally, Phunware’s operating expenses have increased, partly due to one-time legal costs, and the company has experienced a significant EBITDA loss. Despite the potential for new customer acquisitions and product integrations in the hospitality sector, the company faces challenges such as softening trends among advertisers, which could impact future performance. Consequently, while the stock trades below its cash value, the uncertainties and potential headwinds justify a Hold rating with a $3 price target.