On Tuesday, Truist Securities maintained its positive outlook on OneStream Inc. (NASDAQ: OS), reiterating a Buy rating and a $35.00 price target for the stock. The firm's stance comes as OneStream prepares to announce its first quarterly earnings as a publicly-traded company later today.
According to the analyst from Truist Securities, OneStream's preliminary results for the second quarter of 2024, which were disclosed during its initial public offering process, suggest that the company's subscription revenue, total revenue, non-GAAP operating loss, and free cash flow are expected to align with the estimates previously provided.
Consequently, there is no anticipation of significant deviations from the Street's estimates for the second quarter when the company reports.
The guidance for the second half of 2024 is also not expected to show any notable changes to the Street's estimates. Investors are advised to focus on OneStream's performance relative to the third quarter of 2024 and the full year's estimates to gauge the company's progress.
As OneStream gears up to share its financial performance later today, the firm's reiterated Buy rating and price target underscore a steady confidence in the company's value and prospects. The upcoming report marks a significant milestone for OneStream as it shares these details with investors for the first time since going public.
In other recent news, OneStream Inc. has been the subject of coverage initiation by several financial firms, highlighting the company's potential for growth and innovation. Scotiabank initiated coverage with a Sector Outperform rating and a $34 price target, emphasizing OneStream's transformative role in unifying enterprise systems.
The company's Annual Recurring Revenue (ARR) was noted to have grown by 37% in FY23, suggesting a durable growth profile.
Similarly, Needham assigned a Buy rating to OneStream, with a $33 price target, praising the company's integration of machine learning and artificial intelligence technologies into its platform.
BofA Securities also initiated coverage with a Buy rating and a $35 price target, noting a potential 22% upside in the software market. The firm highlighted OneStream's year-over-year revenue increase of 34% for 2023, and projected a 27% revenue increase for 2024.
TD Cowen began coverage with a positive outlook, assigning a Buy rating and a $34 price target, while pointing out the company's potential for significant free cash flow margin expansion. Truist Securities also initiated coverage with a Buy rating and a $35 target, emphasizing OneStream's positive free cash flow and its potential for profitability in the near term.
InvestingPro Insights
As OneStream Inc. (NASDAQ: OS) prepares to unveil its inaugural quarterly earnings, a glimpse into real-time data and InvestingPro Tips can provide investors with a deeper understanding of the company's financial landscape. The market has assigned OneStream a market capitalization of $7.15 billion, reflecting significant investor interest. Despite the lack of profitability in the last twelve months, with a negative P/E ratio of -212.64, the company has demonstrated robust revenue growth of nearly 40% in Q1 2024, indicating a strong market demand for its offerings.
OneStream's gross profit margin stands at an impressive 69.79% for the same period, showcasing the company's ability to maintain profitability at the operational level. However, it's worth noting that the company operates with a moderate level of debt and analysts do not expect OneStream to be profitable this year. Nevertheless, the stock has seen a strong return over the last month and is trading near its 52-week high, which may signal investor optimism about its growth trajectory.
For those considering an investment in OneStream, it's crucial to consider these financial metrics alongside the strategic insights provided by Truist Securities. Additionally, investors can access a wealth of further guidance with 10 additional InvestingPro Tips available at https://www.investing.com/pro/OS, which could help in making a more informed investment decision.
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