BIGC - BigCommerce in red after downgrade by BofA Securities
- BigCommerce ( NASDAQ: BIGC ) fell as much as -6% after it was downgraded by BofA Securities in its latest revision to estimates at the start of 2023.
- The e-commerce software company was downgraded to Neutral from Buy with a price target of $11 (down from $21), citing risk related to the execution of its go-to-market strategy to enterprise customers.
- Analysts estimate the pivot from non-enterprise will likely be a growth headwind until enterprise accounts for over 90% of annual recurring revenue, which they expect will take 12-18 months.
- The note also highlighted BigCommerce's plans to cut 13% of its workforce (both employees and contractors), mostly in the non-enterprise side of the business. BofA Securities believes this could "disrupt growth and the pace of innovation at the business".
- On a positive note, analysts expect restructuring efforts should lead to BigCommerce reaching its adjusted EBITDA inflection target in 4Q23, earlier than the prior "mid to late 2024" goal.
- SA Quant system rates the stock as a Sell.
For further details see:
BigCommerce in red after downgrade by BofA Securities