Needham & Company Upgrades Zuora Inc. (ZUO) to Strong Buy; Top 2019 Pick

Needham & Company analyst Scott Berg upgraded Zuora Inc. (NYSE: ZUO) from Buy to Strong Buy with a price target of $27.00.

Berg commented, "We introduce ZUO as our top pick for 2019 and upgrade our rating to Strong Buy as we believe the combination of end-market growth, strong competitive positioning, conservative estimates, and valuation create an entry point that has been historically attractive to similar growth SaaS peers. We get the recent sell off: a risk-off market not wanting to fight the Fed and ignoring high growth stocks. But we believe ZUO to be the proverbial baby in the bath water, as its fast yet sustainable secular greenfield growth is getting thrown out with short-term, high replacement cycle growth. We find our recent industry work compelling as it suggests demand for ZUO's subscription management platform is not slowing entering 2019. Ultimately, we see ZUO as a highly attractive stock at an EV/revenue multiple of 5.9x our FY20 estimate."

For an analyst ratings summary and ratings history on Zuora Inc. click here. For more ratings news on Zuora Inc. click here.

Shares of Zuora Inc. closed at $17.39 yesterday.

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