Atlassian (TEAM) AI Stock Analysis

• Market Cap: $59.91B
• Dividend Yield: N/A
• Average Volume (3M): 2.56M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.40
• Revenue Growth: 23.19%
• EPS Growth: 11.01%
• Country: US
• Employees: 12,750
• Sector: Technology
• Sector Strength: 62
• Industry: Software - Application
• EPS (TTM): -1.33
• Shares Outstanding: 163,992,260
• 10 Day Avg. Volume: 2,344,864
• 30 Day Avg. Volume: 2,560,514
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 7.78
• Price to Cash Flow (P/CF): 26.50
• P/FCF Ratio: 26.50
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $297.81
• Price Target Upside: 30.23% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 24

Atlassian's strong revenue growth and strategic focus on AI and enterprise segments drive a positive outlook, despite profitability challenges and valuation concerns. Technical indicators suggest mixed momentum, while the earnings call reflects confidence in strategic investments and future growth.

Positive Factors

Product Strategy

The removal of Rovo's $20/user/month price for Premium/Enterprise Cloud customers is seen as a positive move to attract more users.

Regulatory Achievements

The achievement of FedRAMP Moderate for Atlassian Government Cloud is an important step for enabling US Federal migrations to the cloud.

Strategic Initiatives

TEAM is focused on becoming an enterprise platform, which indicates a strategic direction towards broader market penetration.

Negative Factors

International Market Challenges

Some partners noted an increased hesitancy from international customers to have their data stored with US vendors, indicating potential challenges in international markets.

IT Budget Constraints

Constrained IT budgets are weighing on growth, with an elevated focus on tool consolidation.

Macroeconomic Concerns

Concerns exist about softer SMB demand and potential risk around DC customer spending if macroeconomic conditions worsen.

Atlassian Business Overview & Revenue Model

Company Description

Atlassian Corporation, through its subsidiaries, designs, develops, licenses, and maintains various software products worldwide. Its product portfolio includes Jira Software and Jira Work Management, a project management system that connects technical and business teams so they can better plan, organize, track and manage their work and projects; Confluence, a connected workspace that organizes knowledge across all teams to move work forward; and Trello, a collaboration and organization product that captures and adds structure to fluid and fast-forming work for teams. The company also offers Jira Service Management, an intuitive and flexible service desk product for creating and managing service experiences for various service team providers, such as IT, legal, and HR teams; and Jira Align, an Atlassian's enterprise agility solution designed to help businesses to adapt and respond dynamic business conditions with a focus on value-creation. In addition, it provides Bitbucket, an enterprise-ready Git solution that enables professional dev teams to manage, collaborate, and deploy quality code; Atlassian Access, an enterprise-wide product for enhanced security and centralized administration that works across every Atlassian cloud product; and Jira Product, a prioritization and road mapping tool. Further, the company's portfolio includes Atlas, a teamwork directory; Bamboo, a continuous delivery pipeline; Crowd, a single sign-on; Crucible, a collaborative code review; Fisheye, a search, track, and visualize code change software; and Compass, a developer experience platform. Additionally, it offers Opsgenie, an on-call and alert management software; Sourcetree, a free git client for windows and mac; Statuspage that communicates real-time status to users; Beacon, an intelligent threat detection software; and Atlassian Access that enhance data security and governance for Atlassian Cloud products. The company was founded in 2002 and is headquartered in Sydney, Australia.

How the Company Makes Money

Atlassian primarily makes money through a subscription-based revenue model, offering its software products as cloud-based services. The company charges customers on a per-user, per-month basis for access to its suite of tools, with different pricing tiers based on features and scale. Atlassian also generates revenue from on-premises software licenses, which include maintenance and support fees. Additionally, the company earns through its marketplace, where third-party developers sell apps and integrations that complement Atlassian's products, with Atlassian taking a percentage of the sales. Strategic partnerships with other technology companies help expand its customer base and enhance its product offerings, contributing to its revenue growth.

Atlassian Financial Statement Overview

Summary

Atlassian exhibits strong revenue growth and effective cash flow management, despite facing profitability challenges. The balance sheet shows moderate leverage and sufficient liquidity, which supports ongoing operations. The focus on expanding revenue while managing costs is evident, though achieving profitability remains a key area for improvement.

Income Statement

Atlassian's TTM revenue growth is positive, increasing from $4.36 billion to $4.79 billion, indicating a healthy growth trajectory. However, the company has negative EBIT and net income, reflecting challenges in achieving profitability. The gross profit margin remains strong at approximately 81.7%, suggesting efficient cost management in generating revenue.

Balance Sheet

The company's balance sheet shows a reasonable debt-to-equity ratio of 1.02, indicating moderate leverage. The equity ratio is 22.4%, suggesting a balanced asset financing structure. The negative net income impacts the return on equity, which is currently negative. However, the substantial cash reserves provide financial stability.

Cash Flow

Atlassian demonstrates strong cash flow generation with a substantial operating cash flow to net income ratio, indicating efficient cash conversion from operations. The free cash flow is robust, and its growth remains stable. The company's free cash flow to net income ratio is also favorable, highlighting strong cash management.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
4.79B	4.36B	3.53B	2.80B	2.09B	1.61B
	Gross Profit
3.92B	3.56B	2.90B	2.34B	1.75B	1.35B
	EBIT
-135.09M	-117.08M	-345.22M	-106.46M	101.63M	14.09M
	EBITDA
1.43M	57.35M	-239.97M	-374.58M	-419.10M	-199.20M
	Net Income Common Stockholders
-346.14M	-300.52M	-486.76M	-614.12M	-696.32M	-350.65M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
681.99M	2.34B	2.11B	1.46B	1.23B	2.16B
	Total Assets
915.73M	5.21B	4.11B	3.36B	2.95B	3.89B
	Total Debt
507.00K	1.25B	1.28B	1.31B	605.35M	1.15B
	Net Debt
-569.76M	-927.59M	-820.19M	-70.77M	-313.88M	-326.22M
	Total Liabilities
211.10M	4.18B	3.45B	3.03B	2.65B	3.32B
	Stockholders Equity
704.63M	1.03B	654.67M	335.60M	294.91M	575.31M
Cash Flow		Free Cash Flow
1.39B	1.42B	842.30M	808.89M	808.01M	538.50M
	Operating Cash Flow
1.43B	1.45B	868.11M	883.50M	841.33M	574.21M
	Investing Cash Flow
-186.12M	-963.75M	-1.26M	46.85M	256.64M	-318.93M
	Financing Cash Flow
-486.78M	-408.22M	-148.42M	-461.73M	-1.65B	-42.58M

Atlassian Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 228.68
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TEAM, the sentiment is Positive. The current price of 228.68 is above the 20-day moving average (MA) of 205.23, below the 50-day MA of 236.22, and above the 200-day MA of 217.99, indicating a neutral trend. The MACD of -4.67 indicates Negative momentum. The RSI at 56.78 is Neutral, neither overbought nor oversold. The STOCH value of 84.40 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TEAM.

Atlassian Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WDAY	76 Outperform	$63.71B	122.50	6.15%	―	16.94%	-62.24%
DOCU	76 Outperform	$16.77B	16.19	68.18%	―	7.78%	1345.45%
HUBS	72 Outperform	$32.10B	7,173.54	0.29%	―	21.07%	―
DDOG	68 Neutral	$31.72B	179.20	7.75%	―	26.12%	274.50%
SNOW	66 Neutral	$52.92B	―	-31.43%	―	29.21%	-51.47%
TEAM	61 Neutral	$59.91B	―	-32.59%	―	23.19%	11.01%
Sector *	59 Neutral	$10.72B	10.22	-6.67%	3.02%	7.42%	-11.38%

Atlassian Corporate Events

Atlassian Appoints Karen Dykstra to Board of Directors

On April 9, 2025, Enrique Salem announced his retirement from the Board of Directors of Atlassian Corporation, effective April 14, 2025, after nearly 12 years of service. Subsequently, on April 11, 2025, the Board appointed Karen Dykstra as a new director, effective April 14, 2025. Dykstra, who has previously held executive roles at VMware and serves on boards of other prominent companies, will join Atlassian’s Audit Committee. Her compensation includes a pro-rated retainer and restricted stock units, with provisions for accelerated vesting upon a company sale.

Spark’s Take on TEAM Stock

According to Spark, TipRanks’ AI Analyst, TEAM is a Neutral.

Atlassian’s stock score reflects strong revenue growth and effective cash flow management, offset by challenges in achieving profitability and a bearish technical outlook. The earnings call provided a positive outlook due to strategic investments and strong performance in key segments, but valuation concerns and execution risks remain significant factors.

To see Spark’s full report on TEAM stock, click here.