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Investing.com - TD Cowen has lowered its price target on SentinelOne Inc (NYSE:S) to $22.00 from $24.00 while maintaining a Buy rating on the cybersecurity company’s stock. The new target still represents significant upside from the current price of $15.03, with SentinelOne trading near its 52-week low of $15.17. InvestingPro analysis suggests the stock is currently undervalued.
The price target reduction follows SentinelOne’s fiscal third-quarter results, which exceeded most Street metrics including revenue, annual recurring revenue (ARR), and earnings per share. Despite not being profitable over the last twelve months, the company has maintained strong revenue growth of 25.39% and an impressive gross profit margin of 74.95%.
TD Cowen noted concerns about the company’s muted fiscal fourth-quarter guidance, which did not reflect the full scope of the third-quarter beat, along with a CFO transition that raises questions about sustained execution levels.
The firm observed that demand for SentinelOne’s products remains solid, as indicated by a healthy pipeline and strong remaining performance obligations (RPO), which increased 35% year-over-year.
SentinelOne shares fell approximately 8% in after-hours trading following the earnings report, suggesting investors expected stronger results or guidance despite management’s assertion that recent go-to-market efforts are beginning to show positive results.
In other recent news, SentinelOne has reported earnings that exceeded consensus expectations for annual recurring revenue (ARR), positively impacting investor sentiment. Despite the strong performance, several analyst firms have adjusted their price targets for SentinelOne. Needham lowered its price target to $21, citing the company’s quarterly performance and recent acquisitions, Prompt Security and Observo AI. Similarly, Bernstein SocGen Group reduced its price target to $21 due to narrative concerns, despite the company beating its fiscal third-quarter guidance by $3 million. Cantor Fitzgerald maintained an Overweight rating with a $22 target, noting SentinelOne’s slight revenue and margin beat but highlighting adjustments in the company’s future guidance. Canaccord Genuity and Citizens also revised their price targets to $23, with Canaccord noting a surprise CFO transition and Citizens acknowledging improvements in execution. These developments reflect a mix of optimism and caution among analysts regarding SentinelOne’s future prospects.
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