Analyst Scott Berg of Needham maintained a Buy rating on SPS Commerce (SPSC – Research Report), retaining the price target of $205.00.
Scott Berg has given his Buy rating due to a combination of factors surrounding SPS Commerce’s recent strategic acquisition and its potential for revenue growth. The acquisition of Traverse Systems represents a pivotal move for SPS Commerce, allowing them to penetrate the retail market for the first time. Although the deal was closed at a valuation higher than SPS Commerce’s usual acquisitions, Berg believes that the benefits, such as competitive advantages in enablement campaigns and the creation of a new go-to-market channel for retailers, justify the premium.
Furthermore, Traverse Systems’ existing profitability, albeit marginal, alongside its untapped potential for revenue expansion, provides an optimistic outlook when leveraged with SPS Commerce’s significantly larger sales force. Berg’s analysis is reinforced by the adjustment of fiscal year estimates, which align with the management’s guidance on the anticipated impact on revenue and profitability. This strategic initiative, coupled with SPS Commerce’s capabilities, underpins the rationale behind Berg’s Buy rating.
In another report released on April 26, Craig-Hallum also maintained a Buy rating on the stock with a $210.00 price target.
Based on the recent corporate insider activity of 41 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of SPSC in relation to earlier this year.
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SPS Commerce (SPSC) Company Description:
SPS Commerce, Inc. provides cloud-based supply chain management services. The firm serves retailers, suppliers, grocers, distributors and logistics firms to orchestrate the management of item data, order fulfillment, inventory control and sales analytics across all channels. Its SPS Commerce cloud services platform offers Trading Partner Community, Fulfillment, Assortment, Analytics, Sourcing, and Other Trading Partner Solutions. The company was founded by Gary W. Anderson and Roger Anderson on January 28, 1987 and is headquartered in Minneapolis, MN.
