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Tigress backs MongoDB stock as scalable architecture fuels business performance trends

EditorAhmed Abdulazez Abdulkadir
Published 19/12/2024, 04:46 am
MDB
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On Wednesday, Tigress Financial Partners updated its outlook on MongoDB (NASDAQ: NASDAQ:MDB), raising its price target to $430.00 and maintaining a Buy rating. Currently trading at $262.32, the stock has seen 23 analysts revise their earnings estimates upward for the upcoming period, according to InvestingPro data. The revision follows MongoDB's continued progress and adoption of its Atlas (NYSE:ATCO) DBaaS platform, enhanced by growing AI capabilities.

MongoDB's strategic initiatives have been outlined as a key factor in its upward trajectory. With a market capitalization of $19.48 billion and holding more cash than debt on its balance sheet, the firm's decision to invest in expanding its sales force and market presence is expected to compress margins in the short term but is seen as a driver for long-term growth. The company's go-to-market strategy, aiming for ease of adoption and customer acquisition, is reportedly gaining traction, which is anticipated to accelerate subscription revenue growth.

The third quarter of 2025 saw MongoDB report a 22% year-over-year increase in revenue, reaching $529.4 million. This growth was consistent across its subscription revenue, which also rose by 22% to $512.2 million, and its services revenue, which saw an 18% increase to $17.2 million. As of October 31, MongoDB's customer count had grown to over 52,600, with Atlas revenue up by 26% year-over-year, now representing 68% of total revenue.

MongoDB recently announced the release of MongoDB 8.0, which has been touted as the most efficient version of the database to date. It features 45 architectural improvements, including new capabilities like vector quantization in MongoDB Atlas Vector Search, which is expected to bring performance enhancements, cost reductions, and additional scalability, resilience, and data security features.

The firm emphasized the importance of MongoDB's architecture as the latency of Large Language Models (LLMs) improves. MongoDB's ability to run workloads both on-premises and as a fully managed service in 118 global cloud regions across three hyperscalers is highlighted as a significant advantage, providing customers with the flexibility to meet diverse application and business needs.

The ongoing shift towards hosted and hybrid cloud environments is increasing the demand for scalable, customizable, and developer-friendly database architectures. This trend is expected to continue driving growth in MongoDB's subscription-based revenue model. The firm also noted strong new business momentum, partly driven by more enterprise customers standardizing their data sets on MongoDB's platform to foster innovation and operational efficiency.

Tigress Financial Partners believes that there is significant upside potential for MongoDB's shares. The new price target of $430 indicates a potential return of over 65% from current levels, signaling strong confidence in the company's future performance.

In other recent news, MongoDB has been the focus of multiple analyst updates. Monness, Crespi, Hardt downgraded MongoDB's shares to Sell, citing a slowdown in growth for MongoDB Atlas and the recent resignation of the CFO. The firm has set a price target of $220, reflecting the challenges MongoDB faces in a competitive market.

In contrast, Macquarie initiated coverage on MongoDB with a Neutral rating and a price target of $300, acknowledging the company's appeal among developers, particularly for AI applications. The firm, however, expressed caution regarding MongoDB's future market share expansions due to intensifying competition.

Canaccord Genuity maintained a Buy rating on MongoDB and increased the price target to $385, highlighting the company's promising position in the AI value chain. Truist Securities also increased MongoDB's price target to $400, maintaining a Buy rating, and lauding the company's impressive performance largely fueled by the sustained growth of the Enterprise Advanced business.

Stifel raised its price target for MongoDB from $360 to $425, citing potential for healthy double-digit recurring revenue growth. The firm recognized MongoDB as a key player in the NoSQL database market. All these developments suggest that MongoDB is navigating a complex set of internal and external factors, with analysts providing varying outlooks for the company.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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