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A 25% hit to shares of MongoDB Inc (Nasdaq: MDB) following its Q1 earnings report is not particularly worth buying, says Matthew Broome – a Mizuho analyst.
MongoDB stock lacks a meaningful upside
MongoDB did come in ahead of Street estimates for its first financial quarter on May 30th.What did not sit well with investors, however, was its guidance – both of the quarter as well as the full year. MDB cited slower “Atlas consumption growth and new workload wins” for the weakness in its press release last night.On the plus side, Dev Ittycheria – its chief executive confirmed on the earnings call that MongoDB is not losing share to competitors. But that wasn’t enough to for Mizuho’s Broome to be bullish on the stock. He reiterated his “neutral” stance on MongoDB stock this morning and slashed his price target massively from $380 to $250 only which no longer suggests a meaningful upside from here.Versus their year-to-date high, shares of the software company are now down more than 50%.MongoDB now expects its revenue to fall between $460 million and $464 million on up to 49 cents a share of adjusted earnings in the current quarter. Analysts, in comparison, were at $470 million and 58 cents per share, respectively.
Insider sentiment is negative on MDB
The Nasdaq listed firm also trimmed its full-year guidance to between $2.15 and $2.30 of adjusted per-share earnings and up to $1.90 billion in revenue. Experts were at $2.50 a share and $1.93 billion instead.MongoDB stock is now very attractive at writing also because the corporate insider sentiment has been rather negative on it lately.What it means is that the insiders have sold more shares of the New York headquartered firm over the past quarter versus earlier in 2024, as per Business Insider – which basically speaks to the confidence they have in what the future holds for $MDB.Note that Commerce Bank also announced to have trimmed its stake in MongoDB Inc. by over 6.0% this week. The hedge fund still owns over 2,000 shares of the tech firm but unloaded 136 of them in the fourth quarter.Other investment firms that cut their price objectives on MongoDB shares following its first-quarter financial results last night include Piper Sandler, Baird, Needham, Morgan Stanley, Stifel, and Truist Securities.More By This Author:Dell Q1 Earnings: ‘No Company Is Better Positioned To Bring AI To Enterprise’
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