On Monday, Piper Sandler adjusted its price target for Lightspeed Commerce (NYSE:LSPD) shares, increasing it to $18 from the previous $17, while maintaining a Neutral rating on the stock.
The revision follows Lightspeed's announcement that it concluded fiscal year 2024 with a 32% Gross Payment Volume (GPV) mix and $1.3 million in adjusted EBITDA.
The company has shifted its expectations from slower profitability growth for fiscal year 2025 to a significant improvement in EBITDA and at least 20% growth in top-line revenue.
This change in financial outlook comes amidst a series of strategic alterations within the company, including a 10% reduction in force last month, a CEO change with the reinstatement of Lightspeed's founder, a halt in merger and acquisition activities, and a temporary maximization of the Go-To-Market strategy for Unified Payments.
The analyst from Piper Sandler noted that the long list of recent and pending changes at Lightspeed indicates that the company is still in a transitional phase.
Despite these shifts, there is a rebuilding of confidence in what to expect from Lightspeed in terms of growth and margins in the coming years.
The company's latest financial performance and strategic repositioning efforts suggest a focus on enhancing profitability. Lightspeed's decision to prioritize EBITDA growth marks a pivot from its previous strategy, which could potentially influence the company's financial trajectory moving forward.
InvestingPro Insights
Following Piper Sandler's updated price target on Lightspeed Commerce (NYSE:LSPD), InvestingPro data provides further context to the company's financial standing. Lightspeed holds a market capitalization of $2.37 billion, underscoring its significant presence in the commerce industry. Despite not being profitable over the last twelve months, analysts are optimistic, predicting profitability this year. This is supported by a robust revenue growth of 24.47% and a gross profit margin of 42.37% in the same period, indicating the company's ability to generate earnings above its service costs effectively.
InvestingPro Tips highlight critical strategic aspects, such as Lightspeed holding more cash than debt, which offers financial flexibility and resilience. Additionally, the stock has seen a strong return over the last month, with a 19.26% increase, reflecting investor confidence in the company's recent strategic decisions. For readers looking to delve deeper into Lightspeed's potential, there are 9 additional InvestingPro Tips available, which can be accessed for further detailed analysis. Those interested in enhancing their investment strategies can use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, offering a comprehensive suite of tools to navigate the markets more effectively.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.