UBS initiated coverage on Freshworks Inc (NASDAQ:FRSH) with a Buy rating and a price target of $21.00, holding a more positive outlook on the revenue growth potential compared to the Street. UBS estimates over 20% growth in fiscal 2025. This assessment is based on feedback received from 7 checks and 23 survey participants.
Given the stabilization of demand trends, UBS anticipates that investors will shift their focus from margins to future revenue growth. This shift could benefit companies like Freshworks, which have the potential to rebound quickly in an improving macroeconomic environment.
“Our checks have flagged customer service and sales transformation initiatives as areas where spend could recover quickly,” said UBS, noting it believes the company addresses many of these potential emerging focal points with an estimated over 60% of their ARR coming from support and CRM services.
The company is set to report its Q2/23 earnings on Aug 1. Street estimates stand at $0.02 for EPS and $141.34 million for revenues.