Our Stock of the Week is GitLab, Inc. GitLab is a comprehensive platform designed for software development and collaboration. It uses DevSecOps, a software engineering methodology that speeds up the development process. GTLB provides a wide range of tools that facilitate the entire software development lifecycle, from planning and coding to testing, deployment, and monitoring.
Gitlab is a leader in Agentic AI, which is an advanced form of artificial intelligence that can autonomously make decisions, take actions, and continuously learn from interactions without constant human oversight. It is a significant leap forward in AI technology, combining multiple AI capabilities to solve complex, multi-step problems through reasoning and iterative planning.
Gitlib is expected to earn $0.79 per share in the fiscal year ending January 2025. In the January 2024 quarter, revenue growth was 31%, and EPS growth was 155%. The stock has 20 buy ratings and three hold ratings. The average target price is $80.43.
On December 12, Macquarie initiated coverage of GitLab with an Outperform rating and a $90 price target. It is the top pick for the analyst as the company has emerged as a key vendor in the rapidly evolving developer security operations toolchain, with an AI-powered platform that is useful to managers, developers, testers, IT operations, security teams, analysts, solution architects, and other personnel across the software development lifecycle. The firm is bullish on GitLab's investment opportunity and views the company as a valuable strategic and financial asset, adding that consensus revenue expectations through FY27 look beatable, even with revenue decelerating modestly to +22% year over year in this medium-term horizon.
Technically, the stock has a complex cup with a handle pattern with overhead resistance of about $74. Earnings are due March 3.
As always, we will not chase the stock on Monday morning but will be watching for some positive anticipation in the earnings report.
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This post is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this post. Do not buy, sell, or trade the stocks mentioned herein. We WILL actively trade this stock differently than discussed herein. We will sell into strength and buy or sell anytime for any reason. We will actively trade into any unusual activity. At the time of this post, principals, employees, and affiliates of Shark Investing, Inc. and/or principals, clients, employees, and affiliates of Hammerhead Financial Strategies, LLC, directly or indirectly, controlled investment and/or trading accounts containing no positions in GTLB. To accommodate the objectives of these investing and/or trading accounts, the trading in these shares will be contrary to and/or inconsistent with the information contained in this posting.
