Sprout Social Inc Class A (SPT)
NASDAQ:SPT
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Sprout Social
(NASDAQ:SPT)
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Rating:59Neutral
Price Target:
$5.00
▼(-37.50% Downside)
Action:ReiteratedDate:02/28/26
The score is primarily supported by improving fundamentals (strong gross margins, rising cash generation, low leverage) and a constructive earnings outlook with expanding non-GAAP profitability. It is held back by clearly bearish technicals (below major moving averages with negative MACD) and the valuation/profitability overhang implied by a negative P/E and the absence of a dividend.
Positive Factors
High gross margins and scalable unit economics
Consistently high gross margins (~74%–78%) indicate durable SaaS unit economics that support profitable scaling. Strong margins give Sprout flexibility to invest in product, sales and AI initiatives while preserving the path to sustained non‑GAAP margins and long‑term profitability as revenue grows.
Negative Factors
Ongoing GAAP losses and negative ROE
Persistent GAAP losses and negative returns on equity limit shareholder economics and mean the firm still must convert non‑GAAP improvements into GAAP profitability. Continued losses increase sensitivity to execution missteps and could constrain capital allocation until sustained GAAP profits are achieved.
Read all positive and negative factors
Positive Factors
Negative Factors
High gross margins and scalable unit economics
Consistently high gross margins (~74%–78%) indicate durable SaaS unit economics that support profitable scaling. Strong margins give Sprout flexibility to invest in product, sales and AI initiatives while preserving the path to sustained non‑GAAP margins and long‑term profitability as revenue grows.
Read all positive factors
Sprout Social (SPT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$297.61M
Dividend YieldN/A
Average Volume (3M)1.75M
Price to Earnings (P/E)―
Beta (1Y)1.06
Revenue Growth13.09%
EPS Growth32.34%
CountryUS
Employees1,322
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)0.20
Shares Outstanding53,690,940
10 Day Avg. Volume1,276,475
30 Day Avg. Volume1,748,483
Financial Highlights & Ratios
PEG Ratio0.47
Price to Book (P/B)3.25
Price to Sales (P/S)1.44
P/FCF Ratio16.80
Enterprise Value/Market Cap0.91
Enterprise Value/Revenue0.59
Enterprise Value/Gross Profit0.76
Enterprise Value/Ebitda-9.72
Forecast
1Y Price Target
$9.10Price Target Upside13.75% Upside
Rating ConsensusHold
Number of Analyst Covering10
EPS Forecast (FY)0.9
Revenue Forecast (FY)$505.54M
Sprout Social Business Overview & Revenue Model
Company Description
Sprout Social, Inc. designs, develops, and operates a web-based social media management platform in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It provides cloud software that brings together social messaging, data, and wo...
How the Company Makes Money
Sprout Social primarily makes money by selling subscriptions to its cloud software platform (SaaS). Customers (typically businesses and organizations) pay recurring fees to access Sprout’s tools for social media publishing, engagement/inbox manage...
Sprout Social Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlySprout Social Earnings Call Summary
Earnings Call Date:Feb 26, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call presented multiple strong financial and operational positives — double-digit revenue growth in the quarter, substantial margin and free cash flow improvement, growing RPO and larger enterprise wins with meaningful upmarket traction ($30K+ growth and >70% multiproduct attach). Management also outlined clear product and AI roadmaps (Trellis, Guardian, NewsWhip) and an ambitious Rule of 40 target for 2027. Offsetting these positives are concrete near-term challenges: a sub-$30K cohort that has pressured growth and unit economics, weaker expansion revenue that held NDR near 100%, and an expected transition period while the downmarket product and go-to-market changes are implemented. Management provided guidance and a plan to address these issues, so while there is short-term moderation and execution risk, the balance of evidence points to continued improvement and a constructive outlook.Positive Updates
Revenue Growth and Quarterly Performance
Q4 revenue of $120.9M representing ~12.9% year-over-year growth; subscription revenue of $118.5M, up 12% YoY; Q4 ACV up 16% YoY.
Negative Updates
Sub-$30K Cohort Dragging Growth and Profitability
Management acknowledged the sub-$30K (below $30K ARR) segment has been a persistent headwind due to poor product/market fit and high cost-to-serve; they expect to reposition this cohort (self-serve, simplified SKU) but anticipate modest deceleration in that segment during 2026 while changes are implemented.
Read all updates
Q4-2025 Updates
Positive
Negative
Revenue Growth and Quarterly Performance
Q4 revenue of $120.9M representing ~12.9% year-over-year growth; subscription revenue of $118.5M, up 12% YoY; Q4 ACV up 16% YoY.
Read all positive updates
Company Guidance
Sprout guided Q1 FY2026 revenue of $119.9–$120.7 million, non‑GAAP operating income of $9.2–$10.0 million and non‑GAAP net income per share of $0.15–$0.16 (assuming ~59.8M weighted average basic shares), and for FY2026 management expects revenue of $490.2–$495.2 million, non‑GAAP operating income of $54.2–$59.2 million, non‑GAAP net income per share of $0.88–$0.97 (assuming ~60.8M shares) with an exit Q4 non‑GAAP operating margin near 15%; the company said non‑GAAP free cash flow margin should roughly track non‑GAAP operating margin annually, reiterated RPO of $404.0M (with ~70.5% or $284.7M expected to convert to revenue over the next 12 months, CRPO growth ~14.2% YoY), and set a longer‑term target of achieving a 30% Rule‑of‑40 (year‑over‑year revenue growth plus current‑quarter non‑GAAP operating margin) by 4Q 2027.Sprout Social Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
74
Positive
Cash Flow
71
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 457.55M | 405.91M | 333.64M | 253.83M | 187.86M |
| Gross Profit | 354.85M | 314.43M | 257.38M | 193.97M | 141.07M |
| EBITDA | -27.91M | -45.91M | -54.79M | -44.79M | -23.48M |
| Net Income | -43.33M | -61.97M | -66.43M | -50.24M | -28.70M |
Balance Sheet | |||||
| Total Assets | 523.06M | 428.34M | 396.58M | 293.92M | 264.72M |
| Cash, Cash Equivalents and Short-Term Investments | 95.27M | 90.18M | 94.41M | 172.85M | 176.94M |
| Total Debt | 66.77M | 43.29M | 74.03M | 21.79M | 23.64M |
| Total Liabilities | 319.64M | 261.75M | 252.39M | 151.58M | 119.51M |
| Stockholders Equity | 203.42M | 166.59M | 144.19M | 142.34M | 145.21M |
Cash Flow | |||||
| Free Cash Flow | 39.32M | 23.37M | 4.38M | 8.82M | 13.71M |
| Operating Cash Flow | 43.43M | 26.32M | 6.46M | 10.64M | 14.63M |
| Investing Cash Flow | -52.15M | 40.73M | -86.64M | -37.67M | -22.12M |
| Financing Cash Flow | 15.50M | -30.32M | 53.96M | -170.00K | 83.00K |
Sprout Social Technical Analysis
Negative
8.00
Price Trends
6.55
Negative
8.47
Negative
11.63
Negative
Market Momentum
-0.36
Negative
29.44
Positive
20.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPT, the sentiment is Negative. The current price of 8 is above the 20-day moving average (MA) of 5.62, above the 50-day MA of 6.55, and below the 200-day MA of 11.63, indicating a bearish trend. The MACD of -0.36 indicates Negative momentum. The RSI at 29.44 is Positive, neither overbought nor oversold. The STOCH value of 20.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPT.
Sprout Social Risk Analysis
Sprout Social disclosed 48 risk factors in its most recent earnings report. Sprout Social reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Sprout Social Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $601.85M | 8.21 | 19.72% | ― | 22.97% | 49.49% | |
64 Neutral | $1.34B | 69.87 | 3.93% | ― | 6.48% | 168.94% | |
64 Neutral | $592.82M | -28.39 | -8.42% | ― | 6.54% | -19.17% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $297.61M | -15.25 | -22.88% | ― | 13.09% | 32.34% | |
57 Neutral | $441.37M | -0.53 | -106.91% | ― | -7.43% | 61.36% | |
46 Neutral | $101.15M | -4.05 | 31.73% | ― | -0.14% | 21.60% |
* Technology Sector Average
SPT
Sprout Social
4.99
-14.39
-74.25%
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RSKD
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4.00
-0.41
-9.30%
Sprout Social Corporate Events
Business Operations and StrategyFinancial DisclosuresRegulatory Filings and Compliance
Sprout Social Reports Q4 Results and 2026 Outlook
Positive
Feb 26, 2026
On February 26, 2026, Sprout Social reported fourth-quarter 2025 revenue of $120.9 million, up 13% year-over-year, with total remaining performance obligations rising 15% to $404 million and current RPO up 14% to $284.7 million. The company narrow...
Executive/Board Changes
Sprout Social Announces Upcoming CFO Transition and Search
Neutral
Feb 12, 2026
On February 9, 2026, Sprout Social announced that Chief Financial Officer and Treasurer Joe Del Preto intends to resign effective March 11, 2026, to pursue another professional opportunity. The company emphasized that his departure is not related ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.