On Tuesday, Susquehanna analysts raised the price target on Bill.com Holdings Inc. (NYSE: NYSE:BILL) shares to $100.00, up from the previous $91.00, while maintaining a Positive rating on the stock.
The adjustment follows Bill.com's fourth-quarter fiscal year 2024 earnings call, during which the company provided optimistic long-term guidance. Bill.com committed to achieving core revenue growth of over 20% in fiscal year 2026, building on its current revenue growth of 18.54%. According to InvestingPro data, analyst targets for the stock range from $55 to $120, suggesting diverse market opinions about the company's prospects.
The Susquehanna analyst's confidence in Bill.com stems from recent insights shared by the company's CFO at a conference. The CFO outlined a "portfolio approach" to monetization, which includes expanding the company's loan book and enhancing cross-border payment monetization.
These strategies are seen as key drivers for reaching the forecasted revenue growth. The company's impressive gross profit margin of 85.24% and strong financial health score, as reported by InvestingPro, support this optimistic outlook.
Despite the positive outlook, the analyst noted potential challenges that could impact the company's ability to meet its targets. A key concern is the rising U.S. dollar, which may pose headwinds to the monetization of cross-border payments, a significant component of Bill.com's growth strategy.
The price target increase to $100 is attributed to a combination of Bill.com's strategic initiatives and an expansion of peer multiples. This indicates that while the company's own efforts are recognized, broader market trends affecting similar companies have also played a role in the revised price target.
The stock has shown strong momentum with a 66.1% return over the past six months. For deeper insights into Bill.com's valuation and growth potential, InvestingPro subscribers can access comprehensive research reports and 12 additional ProTips about the company.
Bill.com's commitment to maintaining a growth rate of 20% or more in the coming fiscal years reflects the company's confidence in its business model and strategic direction. The update from Susquehanna signals to investors that despite potential currency-related challenges, Bill.com's financial outlook appears robust, supported by positive net income expectations and strong cash management practices.
In other recent news, BILL Holdings Inc. has been making significant strides. The company's inclusion in the S&P MidCap 400 index is a notable development, reflecting its recognition as a prominent player among mid-sized companies in the U.S. market. Analysts from Baird and US Tiger Securities have maintained a Neutral and Buy rating on the stock respectively, acknowledging BILL's potential for revenue growth.
BILL's recent Q3 results surpassed consensus expectations, marking the company's first instance of non-GAAP profitability. The company's revenues reached $358 million, surpassing the consensus estimate of $348 million and indicating a 19% year-over-year core revenue increase. Furthermore, BILL's management revised its revenue growth forecast for fiscal year 2025, now expecting a 12-13% increase year-over-year.
In a strategic move, BILL repurchased 3.7 million shares worth $200 million as part of a $300 million authorization. The platform now serves over 475,000 businesses, handling $80 billion in payment volume, further demonstrating its growth trajectory and market leadership. These recent developments reflect the company's confidence in its future growth and market position.
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