Stifel Downgrades Avalara (AVLR) to Hold

August 8, 2022 10:59 AM EDT
Get Alerts AVLR Hot Sheet
Price: $93.48 --0%

Rating Summary:
    6 Buy, 12 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 3 | Down: 9 | New: 8
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Stifel analyst Brad Reback downgraded Avalara (NYSE: AVLR) from Buy to Hold with a price target of $93.50 (from $95.00).

The analyst comments "Before the open, Avalara announced an agreement to be acquired by Vista Equity Partners for $93.50/share in an all cash transaction ($8.4B EV). This agreement represents a ~27% premium to the 7/6 closing price of $73.54 per share when reports of a potential transaction first surfaced, and values Avalara at ~7.9x CY23E EV/revenue. The deal has been unanimously approved by AVLR's Board of Directors but is subject to shareholder and regulatory approvals, with an expected closing date during 2H22. Given the earlier press reports we believe this was a well shopped transaction and do NOT expect an overbid. Concurrent with the announcement, Avalara announced mixed 2Q22 results, with ~17% billings growth. We view the deal as a positive read through for Vertex and serves as another reminder that software M&A remains robust. Given the deal, we lower our TP to $93.50 and downgrade shares to Hold."

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

Shares of Avalara closed at $95.55 yesterday.

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