TD Cowen adjusted its price target for shares of Braze Inc (NASDAQ:BRZE), a customer engagement platform, reducing it to $45.00 from the previous $52.00. Despite the lower price target, the firm maintained a Buy rating on the stock. The adjustment followed the attendance of Braze's Analyst Day, which occurred during the company's annual Forge Conference in Las Vegas.
During the event, Braze's management highlighted several strategies aimed at achieving a return to the Rule of 40—a financial metric used to assess a company's performance by combining growth rate and profit margin. They also increased long-term gross margin (GM) targets to a range of 69-74% and provided guidance for the fourth-quarter fiscal year 2025 net revenue retention (NRR) at 110%.
TD Cowen's report noted that Braze previewed multiple new features at the conference, which are expected to promote product-led growth (PLG) motions and bolster customer retention. The company's go-to-market (GTM) strategies are designed to enhance customer acquisition speed, product stickiness, and sales efficiency.
The analyst's commentary reflected optimism about the company's direction, stating, "Maintain Buy. PT to $45." The maintained Buy rating indicates a belief in the company's potential for growth and value creation for its shareholders, even with the revised price target.
In other recent news, Braze Inc. reported a 26% increase in its fiscal second quarter 2025 revenue, reaching $145.5 million, and added 61 new customers, bringing the total to 2,163. The company's third quarter revenue is projected to be between $147.5 million and $148.5 million, with full fiscal year 2025 revenue expected to be between $582.5 million and $585.5 million.
Analyst firms Piper Sandler, Loop Capital, and Oppenheimer have maintained positive ratings for Braze, with Piper Sandler holding an Overweight rating and a $51 target, Loop Capital reiterating a Buy rating with a $75 target, and Oppenheimer maintaining an Outperform rating but adjusting its target to $51 from $60. DA Davidson also adjusted their target to $55 from $65, but retained a Buy rating.
InvestingPro Insights
Following the recent update from TD Cowen on Braze Inc (NASDAQ:BRZE), it's worth considering additional insights provided by InvestingPro. Despite a challenging period with the stock performing poorly over the last month and trading near its 52-week low, Braze stands out with a robust balance sheet, holding more cash than debt. This financial stability is underscored by the fact that the company's liquid assets exceed its short-term obligations, providing a cushion against market volatility.
Analysts are taking note of Braze's potential, with 11 analysts revising their earnings upwards for the upcoming period, signaling confidence in the company's prospects. Moreover, while the company was not profitable over the last twelve months, analysts predict that Braze will turn profitable this year. This is a critical factor for investors considering the company's future earnings potential.
InvestingPro Data further enriches our understanding of Braze's financial position. The company's market capitalization stands at $3.56 billion, and despite a negative P/E ratio of -30.29, reflecting its current lack of profitability, the company has shown a strong revenue growth of 31.12% over the last twelve months as of Q2 2025. Additionally, the gross profit margin during the same period was an impressive 68.77%, aligning with the management's increased long-term GM targets.
For those seeking more in-depth analysis, additional InvestingPro Tips are available, which can provide further guidance on Braze's stock performance and financial health. Visit InvestingPro for a comprehensive list of tips and metrics that can aid in making a well-informed investment decision.
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