Our 1-year price target is $275 per share, which implies a ~13x FY2029E EV/revenue discounted at an 12% cost of equity. Our valuation framework is based on a regression analysis of trading multiples and growth + profitability of companies across the software universe, which weighs revenue growth 65% and operating margins 35%.

This stock is High Risk based upon our quantitative model but assigning a High Risk rating is not supported by other qualitative factors such as the staying power of its business model, so a High Risk rating has not been applied.


Risks that could drive the stock below our target price include:
1) Volatility of a consumption model, especially through a market downturn;  
2) Competitive pressure from the cloud infrastructure providers; 
3) Uptake of adjacent products are slower than expected, thus lower cross/up-sell opportunities; and  
4) TAM of Cloud Data Platform and Data Cloud deterioration from pressure of new disruptive technology/specialized vendors.