Atlassian (TEAM) AI Stock Analysis

• Market Cap: $52.61B
• Dividend Yield: N/A
• Average Volume (3M): 2.29M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.31
• Revenue Growth: 19.12%
• EPS Growth: -161.42%
• Country: US
• Employees: 12,157
• Sector: Technology
• Sector Strength: 86
• Industry: Software - Application
• EPS (TTM): 0.97
• Shares Outstanding: 165,244,900
• 10 Day Avg. Volume: 2,437,030
• 30 Day Avg. Volume: 2,294,872
• PEG Ratio: 16.07
• Price to Book (P/B): 36.27
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.99
• Enterprise Value/Market Cap: 0.91
• Enterprise Value/Revenue: 2.57
• Enterprise Value/Gross Profit: 11.76
• Enterprise Value/Ebitda: -1.53K
• 1Y Price Target: $261.71
• Price Target Upside: 28.92% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 23

• Rating: 67 Neutral
• Price Target: $217.00 ▲(6.90%Upside)

Atlassian's strong financial performance and positive earnings call sentiment are key strengths, reflecting robust revenue growth and strategic advancements in AI. However, technical analysis and valuation scores suggest caution due to ongoing profitability challenges and macroeconomic uncertainties. The overall score reflects a balanced view of the company's growth potential and current market risks.

Positive Factors

Cloud Migration

Cloud migration offers significant upside potential for Atlassian.

Financial Performance

Atlassian outperformed across all fronts in its third quarter, with Cloud revenue growth of 25.2%, ahead of expectations.

Growth Opportunities

TEAM's attractive risk/reward at a significant discount to peers highlights potential for growth.

Negative Factors

Developer Headcount

Investors are concerned about potential declines in developer headcount due to the efficacy of Code Generation tools and AI monetization.

Investor Sentiment

Shares of Atlassian are down approximately 23% year-to-date, reflecting negative investor sentiment.

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 generates revenue primarily through the sale of software subscriptions, licenses, and related support and services. The company offers its products via a subscription-based model, with customers paying for access to software hosted in the cloud or through on-premises licenses. Key revenue streams include Jira Software, Jira Service Management, Confluence, Trello, and other collaborative tools. Atlassian also earns from the Atlassian Marketplace, where third-party developers can sell add-ons and integrations, sharing revenue with Atlassian. The company benefits from a high-volume, low-touch sales model, leveraging a self-service approach that reduces the need for a large sales force. Additionally, strategic partnerships and an extensive ecosystem of integrators and developers contribute significantly to its earnings by expanding the functionality and reach of its core products.

Atlassian Financial Statement Overview

Summary

Atlassian exhibits robust revenue growth and strong cash flow generation, crucial strengths for the software industry. However, persistent net losses and negative margins suggest areas for improvement in operational efficiency and cost management. The company's sound balance sheet provides a solid foundation to address profitability challenges and continue its growth trajectory.

Income Statement

Atlassian's revenue has shown impressive growth with a TTM increase to $4.96 billion from $4.35 billion in the previous year, a growth rate of approximately 13.9%. The gross profit margin remains strong at 82.2% TTM. However, the company continues to face challenges with profitability, as indicated by negative net profit margins and EBIT margins in both TTM and the previous year, highlighting an ongoing struggle to convert revenue growth into net income.

Balance Sheet

Atlassian maintains a healthy financial position with a strong equity base and a debt-to-equity ratio of 0.90 TTM, indicating a balanced approach to leverage. The return on equity remains negative due to net losses, but the equity ratio improved to 23.3% TTM, reflecting a solid asset base supported by equity.

Cash Flow

The company demonstrates strong cash flow management, with a significant operating cash flow of $1.51 billion TTM and a stable free cash flow, which saw a modest growth rate of about 3.5% from the previous year. The operating cash flow to net income ratio is robust, indicating efficient cash generation relative to net income losses.

Breakdown	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement
Total Revenue	4.36B	3.53B	2.80B	2.09B	1.61B
Gross Profit	3.56B	2.90B	2.34B	1.75B	1.35B
EBITDA	57.35M	-239.97M	-374.58M	-419.10M	-199.20M
Net Income	-300.52M	-486.76M	-614.12M	-696.32M	-350.65M
Balance Sheet
Total Assets	5.21B	4.11B	3.36B	2.95B	3.89B
Cash, Cash Equivalents and Short-Term Investments	2.34B	2.11B	1.46B	1.23B	2.16B
Total Debt	1.25B	1.28B	1.31B	605.35M	1.15B
Total Liabilities	4.18B	3.45B	3.03B	2.65B	3.32B
Stockholders Equity	1.03B	654.67M	335.60M	294.91M	575.31M
Cash Flow
Free Cash Flow	1.42B	842.30M	808.89M	808.01M	538.50M
Operating Cash Flow	1.45B	868.11M	883.50M	841.33M	574.21M
Investing Cash Flow	-963.75M	-1.26M	46.85M	256.64M	-318.93M
Financing Cash Flow	-408.22M	-148.42M	-461.73M	-1.65B	-42.58M

Atlassian Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 203.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• 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 Neutral. The current price of 203 is above the 20-day moving average (MA) of 201.51, below the 50-day MA of 204.93, and below the 200-day MA of 231.85, indicating a neutral trend. The MACD of -1.77 indicates Negative momentum. The RSI at 51.95 is Neutral, neither overbought nor oversold. The STOCH value of 82.23 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TEAM.

Atlassian Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNOW	78 Outperform	$71.74B	―	-40.16%	―	27.50%	-49.96%
DDOG	76 Outperform	$50.61B	317.50	6.48%	―	25.54%	40.02%
DOCU	75 Outperform	$16.45B	15.38	70.20%	―	7.85%	935.80%
WDAY	72 Outperform	$63.33B	130.97	5.70%	―	15.38%	-67.58%
TEAM	67 Neutral	$52.61B	―	-34.33%	―	19.12%	-161.42%
HUBS	64 Neutral	$29.58B	7,452.21	-1.34%	―	19.17%	83.20%
Sector *	63 Neutral	$34.70B	4.89	-11.39%	1.66%	5.53%	-19.00%

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.