U - There Are Several Risks To Cloud And Software Stocks But Microsoft Is Still Favorite Analyst Asserts | Benzinga
Piper Sandler analyst Brent A. Bracelin lowered ratings and revised estimates for several Cloud Applications and Analytics stocks.
The move reflects analysts' view on near-term demand stabilization trends that may not support 'an overly optimistic acceleration' in consensus growth rates, which are expected to increase by ~550bps to 19% in Q4 FY24 from 14% in Q4 FY23.
Also, the analyst writes that the budget priority has shifted in favor of testing and implementing generative AI features and thus creates a high risk of a 'potential H2 airpocket'.
The analyst is also concerned about 2024 growth on a meaningful slowdown in unique visitor growth for many SW stocks in September.
Despite this, the analyst still favors Microsoft Corp (NASDAQ: MSFT) on AI catalyst and Procore Technologies Inc (NYSE: PCOR) on