MongoDB Inc. shares declined 4.2% in after-hours trading on Wednesday despite Cantor Fitzgerald reaffirming its $540 price target and above-average rating for the software company.
The stock, which closed at $434.21, slipped further to $374.05 in pre-market activity, reflecting a 13.9% drop. MongoDB's market capitalization stands at $34.9 billion. Cantor Fitzgerald cited the company's exposure to application modernization and artificial intelligence as key drivers for its positive outlook.
Analysts remain divided on valuation. Rosenblatt raised its price target to $445, while UBS reduced its target to $410, maintaining a neutral stance. Bernstein increased its target to $484, and Canaccord set its target at $480. Needham kept its $430 target unchanged with a buy rating. The consensus price-target range spans from $273 to $560.
MongoDB reported a 30% revenue increase in the second quarter, surpassing Rosenblatt's estimates and market expectations by roughly 5%. The company's Atlas cloud product, which now accounts for 73% of total revenue, grew 29% year-over-year. However, after-hours pricing implied a sum-of-the-parts valuation of 9.75x, representing a 35% discount to peers with comparable growth profiles.
InvestingPro rated MongoDB's financial health as strong but flagged significant stock volatility. The platform also noted the stock appeared overvalued relative to its intrinsic value. Over the past six months, MongoDB shares have delivered a 33.6% return, while trailing twelve-month revenue growth reached 23.6%.
