GitLab Inc (GTLB) PT Lowered to $60 at Scotiabank
Scotiabank analyst Nick Altmann lowered the price target on GitLab Inc (NASDAQ: GTLB) to $60.00 (from $67.00) while maintaining a Sector Outperform rating.
The analyst commented: "A skinnier beat vs. historical levels (80bps upside vs. ~330bps avg in FY25) and a maintained growth outlook were the culprits of GTLB shares trading lower AH despite valuation levels remaining suppressed vs. peers. The magnitude of upside was more limited due to linearity (which surfaced in RPO stabilizing Q/Q at 40%) and higher SaaS bookings mix (which had a more profound impact), though mgmt noted the macro & its guidance philosophy remains unchanged Q/Q. Positively, seat contribution to NRR (80%) continued its strength and points to stabilizing seat counts & Duo adoption continuing, evidenced by first order Duo bookings up 35% Q/Q. Mgmt also noted seeing no deterioration in seat counts, which is encouraging as several GenAI-induced questions remain an overhang on shares (i.e., success of Cursor & Windsurf, GenAI shrinking developer headcount, etc.). The smaller beat is something worth monitoring and likely throws question marks into the FY26 upside case, though similar linearity dynamics surfaced in our checks, and continued upside to margins should provide relative FCF support. We maintain Sector Outperform but trim FY27 growth ests and lower PT to $60."