In a report released yesterday, Fred Mendes from Bank of America Securities maintained a Buy rating on VTEX (VTEX – Research Report), with a price target of $13.00.
Fred Mendes has given his Buy rating due to a combination of factors related to VTEX’s strong performance and potential for future growth. He anticipates that VTEX will continue to show robust top-line growth, forecasting a 27% year-over-year increase, which aligns with the higher end of the company’s guidance. Furthermore, Mendes expects VTEX to achieve a solid EBITDA margin of 5%, noting its improvement from -8% in the same quarter of the previous year, despite a seasonal dip from the previous quarter. Additionally, the company’s net income is projected to approach breakeven, suggesting improving profitability.
Mendes’s optimism extends to the company’s adjusted EBITDA margin, which he believes will surpass market expectations at 14%. He highlights the potential for VTEX’s continued acquisition of new customers, especially in its international expansion efforts, as a catalyst for revaluation. Maintaining the Buy rating, Mendes sees a strong momentum for the company, with significant growth and operational leverage, and he identifies upside potential in VTEX’s US and European operations, which make up about 11% of its revenue. His price objective of USD 13 reflects this positive outlook.
According to TipRanks, Mendes is ranked #1143 out of 8735 analysts.
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VTEX (VTEX) Company Description:
Vtex provides a software-as-a-service digital commerce platform for enterprise brands and retailers. Its platform enables customers to execute their commerce strategy, including building online stores, integrating and managing orders across channels, and creating marketplaces to sell products from third-party vendors. It generates maximum revenues from Brazil followed by Latin America and the rest of the world.
