In a report released today, Michael Infante from Morgan Stanley maintained a Hold rating on Q2 Holdings (QTWO – Research Report), with a price target of $89.00.
Michael Infante has given his Hold rating due to a combination of factors that reflect both the current performance and future expectations of Q2 Holdings. The company is anticipated to maintain strong subscription ARR growth, with projections aligning with the previous quarter’s performance. However, there is some uncertainty regarding potential macroeconomic factors that could lead to deal delays, although these are expected to be temporary.
Despite these concerns, the overall outlook remains stable, with the expectation that the company’s initiatives in deposit attraction and retention will not be significantly impacted by current rate trajectories. Additionally, while there is some debate about the conservatism of future revenue growth estimates, the anticipated subscription ARR growth and full-year outlook reiteration are seen as sufficient to prevent downward pressure on the stock. These elements contribute to the decision to maintain a Hold rating, as the stock’s performance is expected to remain steady without significant upward or downward movement.