William Blair analyst Arjun Bhatia has maintained their bullish stance on SMWB stock, giving a Buy rating today.
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Arjun Bhatia has given his Buy rating due to a combination of factors including Similarweb’s impressive second-quarter performance, which exceeded revenue expectations with a 17% growth rate. This growth was driven by strong demand trends, effective sales execution, and a significant contribution from AI-related revenues, which accounted for nearly 8% of the total revenue. The company’s ability to surpass its operating income margin expectations, achieving a 3% margin compared to the anticipated -1%, further supports the positive outlook.
Management’s strategic hiring earlier in the year has positioned the company well to meet increasing demand, and there is optimism that this expanded sales capacity will drive further revenue growth. Despite the strong quarterly performance, Similarweb has prudently maintained its full-year revenue growth guidance at 15%, reflecting a cautious approach to AI revenue contributions and sales productivity. The market’s positive response, with the stock rising 18%, underscores investor confidence in the company’s ability to meet its full-year targets, justifying the Buy rating.
In another report released today, Barclays also maintained a Buy rating on the stock with a $12.00 price target.