Asana (ASAN) PT Raised to $19 at Piper Sandler, citing 'Return to 10%+ Growth'

Piper Sandler analyst Brent Bracelin raised the price target on Asana (NYSE: ASAN) to $19.00 (from $12.00) while maintaining a Neutral rating.

The analyst said: "ASAN continues to operate in a challenging environment, underpinned by increased budget scrutiny, and longer sales cycles. That said, the Q4 outlook of 10% growth would mark the third consecutive quarter of top-line stabilization, in part driven by an increasing contribution from non-tech verticals (~66% of sales). We are raising our PT to $19 from $12 on higher estimates and a higher target EV/FCF multiple of 20x (vs. 18x prior) to better reflect improving prospects that growth stabilizes in the low-teens. The new CFO Sonalee Parekh plans to lay out a cost reallocation plan in early March hinting that a path to positive FCF and/or profitability is within reach. In order to justify further multiple expansion after ASAN shares have risen 38%+ in 3-mo, we would need to see broader proof-points on both AI Studio adoption and internal appetite to drive a higher level of cost discipline.

We are raising our PT to $19 from $12 to better reflect improving prospects that growth stabilizes in the low-teens. In order to justify further multiple expansion after ASAN shares have risen 38%+ in 3-mo, we would need to see broader proof-points on both AI Studio adoption and internal appetite to drive a higher level of cost discipline."

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