Loop Capital Starts Descartes (DSGX) at Buy

Loop Capital analyst Mark Schappel initiates coverage on Descartes (NASDAQ: DSGX) with a Buy rating and a price target of $140.00.

The analyst comments "We are initiating coverage of Descartes Systems (Nasdaq: DSGX) with a Buy rating and $140 price target. Descartes is a play on the tariff theme that is a core tenet of a Trump Presidency where the new administration is set on restructuring trade agreements and leveraging tariffs as a protectionist measure to boost US manufacturing. Regardless of one's view of the matter, trade-related regulatory changes and increasing trade friction add complexity to transporting goods across international borders, which historically have been a boon to global trade automation vendors like Descartes that help logistic-intensive businesses streamline common tasks related to import/export processes, such as generating trade documentation, screening restricted party lists, customs filings, and calculating duty and tariffs. All of this has not been lost on investors, which has driven the stock price straight up and to the right (+47% ytd and 11% post-election) and towards the upper end of the valuation range in which we would prefer to buy the stock. However, for those wanting exposure to this dynamic, we believe it is OK to have some exposure to DSGX here, and then add more aggressively to positions on pullbacks. Initiate at Buy."

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

Shares of Descartes closed at $119.27 yesterday.

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