Close

UPDATE: Bernstein Starts Atlassian Corporation (TEAM) at Outperform

July 20, 2022 3:40 AM EDT
Get Alerts TEAM Hot Sheet
Price: $131.55 +7.82%

Rating Summary:
    18 Buy, 14 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 5 | Down: 17 | New: 31
Join SI Premium – FREE
(Updated - July 20, 2022 5:31 AM EDT)

Bernstein analyst Peter Weed initiates coverage on Atlassian Corporation (NASDAQ: TEAM) with a Outperform rating and a price target of $257.00.

The analyst comments "Since its 2015 IPO, Atlassian's “flywheel” has delivered one of the most consistent 30%+ growth at 30%+ Free Cash Flow stories in Cloud SaaS. We are bullish on Atlassian ability to surpass $6B revenue in FY25 based on it being a key enabler of a major secular tailwind, its current migration of customers to Cloud SaaS offerings at a price premium, and line-of-sight to continued large TAM expansion. Management cautioned on margin as they expect a greater pace of investment to impact operating margin and migration to cloud to lead to lower gross margin. Consensus seems to have conformed to such guidance. However, we don't expect its gross margin to decline to company's guidance of 80%, and expect operating margin to improve modestly as operating expense gains scale leverage. We believe our estimate of FY25E ~$1.5B operating income (26% above consensus) is reasonable. Lastly, we estimate that there would be $1.1B+ of FY2025E revenue at risk if there is a large recession (like '08-09), leaving our FY25E estimates approximately at current consensus (3% below)."

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

Shares of Atlassian Corporation closed at $191.59 yesterday.


You May Also Be Interested In





Related Categories

Analyst Comments, New Coverage

Related Entities

Sanford C. Bernstein, IPO