2024-05-22 01:21:40 ET
Summary
- Notable increase in share price is primarily attributed to LSPD's substantial improvement in reducing operating losses, coupled with management's announcement of a restructuring plan aimed at further narrowing the gap to profitability.
- Demonstration of continued robust growth in transaction-based revenue, with expectations of subscription revenue re-acceleration in FY25, indicating a positive trajectory towards profitability.
- Forward FY25 valuation indicates a 13% upside potential from the current market cap, based on management's guidance.
- Considering these positive developments and minimal downside risk at the current valuation, I have upgraded my rating for LSPD from a "hold" to a "buy".
Investment Thesis
Previously, in Mar 2024 , I rated Lightspeed ( LSPD ) (LSPD:CA) as a hold given my uncertainty over the company's ability to sustain its growth while progressing towards profitability. Recently, after LSPD released its 4Q24 result, its share price has risen by a staggering 16%, indicating that the market was impressed by LSPD results and this has prompted me to look into why....
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For further details see:
Lightspeed Commerce: On Track For Profitable Growth (Rating Upgrade)