Descartes (DSGX) PT Raised to $125 at Scotiabank

Scotiabank analyst Paul Steep raised the price target on Descartes (NASDAQ: DSGX) to $125.00 (from $120.00) while maintaining a Sector Outperform rating.

The analyst commented: "Shares of DSGX have performed well YTD up nearly 40% (+17% since Q2 earnings Sept. 4 vs. S&P 500 +10%). We were comforted by Q3 results which showed stability in organic services growth q/q at 7%, while we are optimistic of the potential for a slight acceleration in the coming quarters (we model 7.5% in Q4 and 8.0% in Q1). Although US trucking volumes are still weak, we think there are many other areas of DSGX’s model that are performing well including E-Commerce (recent industry BFCM trends outperformed) and Global Trade Intelligence (benefiting from stepped up compliance requirements). Looking ahead, evolving uncertainties related to comments from the incoming Trump administration on changes to tariffs could be a positive for DSGX given the company’s broad portfolio of solutions designed to help customers navigate supply chain & logistics uncertainties. While the stock is not inexpensive (12.7x CY25 Sales), it looks more attractive on EBITDA (28.5x CY25 vs. closest peers MANH at 46.5x and Wistech at 55.7x), especially in light of its stellar Rule-of-50 operating profile. Our target increases to $125 (was $120) on updated estimates (reflects ~30.0x F26 EBITDA)."

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