SentinelOne Inc (S) PT Lowered to $23 at BTIG
BTIG analyst Gray Powell lowered the price target on SentinelOne Inc (NYSE: S) to $23.00 (from $30.00) while maintaining a Buy rating.
The analyst comments "S’s Q1/April print was disappointing. Most notably, S delivered ARR of $762MM / +35% y/y vs our estimate of $767MM /+36.2% (street $765MM). In addition, the company reduced its FY25 revenue guidance by ~0.5% to a midpoint of $811.5MM / +31% from $815MM previously. Investor sentiment on S has been consistently negative over the last few weeks, and we have increasingly been hearing concerns on competition, GTM changes, and SMB exposure. While expectations were not particularly high heading into the report, we do not think the buy side was braced for a 10% y/y decline in net new ARR after the metric stabilized in 2H’24. That said, it was not all bad. Emerging products are gaining momentum with strength in Data Lake and Cloud Security being the notable standouts. Furthermore, operating margins were substantially better than expected and FCF inflected positively for the first time in company history. To be fair, we knew the macro environment was difficult and most software companies have seen weaker-than-expected trends this quarter. But we were hoping for a slightly better print and were disappointed in results. On our downwardly revised estimates, S now trades at just over 5.0x EV/sales, which we think is compelling for a 25%+ growth story. Maintain Buy."