Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.
Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services.
You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More
When a stock is reviewed positively by an analyst, it usually gets at least a small bump in its price. That, sadly, wasn’t the case with MongoDB (MDB -3.29%) on Thursday. The company’s shares shed more than 3% of their value across the day, despite a glowing new note from a top American bank.
MongoDB is very much on the radar of Citigroup (C -2.96%), whose analyst Tyler Radke designated it a top pick in the software segment. In a research note detailing the reasons why, Radke expressed admiration for the company’s growth potential, writing that recent fundamentals bring “the focus back to its longer-term attractive growth story having one of the largest [total addressable markets] in software.”
Many analysts are — or, prior to Thursday, were — very bullish on MongoDB. Earlier this month the company published its third quarter of fiscal 2023 results, which trounced analyst expectations for both revenue and profitability. In fact, the company’s nearly $19 million ($0.23 per share) in non-GAAP (adjusted) net income was in sharp contrast to the average prognosticator estimate of a per-share loss of $0.17.
Radke’s new take on MongoDB comes a day after his peer Taz Koujalgi at Wedbush initiated coverage of the company’s stock with an outperform (read: buy) recommendation and a $240 price target.
Despite the justifiably optimistic new evaluations of MongoDB, in some ways the company’s stock is a victim of its success.
The share price popped after those results were unveiled, not least because investors were hungry for any good news, anywhere in the beleaguered tech sector. Yet the market is still cautious at best and pessimistic at worst about the industry’s immediate future, and it seems this sentiment has even started to affect MongoDB — regardless of its recent outperformance and those glowing analyst takes.
Citigroup is an advertising partner of The Ascent, a Motley Fool company. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends MongoDB. The Motley Fool has a disclosure policy.
*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.
Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services.
Making the world smarter, happier, and richer.
Market data powered by Xignite.
