Worried about analyst price targets?

Investment Analysis Clubs Saul’s Investing Discussions
1

For those who worry that our stocks are ahead of analyst price targets, this quote from today’s news may be an eye-opener.

* Coupa Software: Wells Fargo raises price target to $200 from $120.

So, the analyst raises his price target by $80 in one day. And it’s a day when there hasn’t been any important news about Coupa for weeks. Does that give you any faith in analyst price targets? He probably forgot about it for a year because he’s trying to keep track of 50 companies.

Saul

37 Likes
2

The analyst hosted a call with a Coupa partner and a Procurement industry expert yesterday. Some highlights:

  • Coupa remains the market leader in business spend management - broadest set of products/solutions
  • Near term could see some slowing in new business activity. Implementations can take 12-18 months. Cost savings realized 6-9 months after that.
  • Long term - Coupa well positioned to capture digitization of procurement and supply chains
  • Coupa Pay traction still early. Best suited for midmarket where customers don’t have ERP.

Oh, and it’s expensive.

3 Likes
3

I learned my lesson when an analyst said sell SHOP as it was overpriced at $70. I sold some only to buy them back at a few dollars more and haven’t looked back since.

4

I don’t own COUP currently. I am not sure how they get paid? Do their customers pay based on savings or a flat subscription fee? If any of their revenues are result based on savings I’d think they may face significant headwinds during the lull in spending cause by C-19.

Rob

1 Like