Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Kerrisdale Issues HubSpot Short Report, Calling Out Flawed, Expensive Products

Stock MarketsDec 22, 2021 11:50AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

By Sam Boughedda

Investing.com — In a short report issued Wednesday morning, investment research firm Kerrisdale Capital told investors that software developer HubSpot Inc 's (NYSE:HUBS) products are "flawed" and the "pricing is expensive."

New York-based Kerrisdale pointed to HubSpot's lack of profitability, fierce competition, and "stale products" as reasons it believes the company's shares will soon fall.

Starting a series of Tweets outlining its reasons, Kerrsdale stated: "We're short $HUBS. Report at http://kerr.co/hubs. Trading at 20x fwd rev, $HUBS benefited from a one-time COVID boost that lifted shares 6x. But fierce competition & stale products will lead to low growth / margins, long before the biz grows into its sky-high valuation."

After closing Tuesday's session at $680.20, HubSpot shares initially fell to a low of $654.53 following the report. Shares have since erased the majority of those losses and now trade around the $681 mark, marginally up for the day.

The company and its share price have soared since the start of the pandemic, climbing just under 70% in 2021 alone. In March 2020 its shares were priced at around $100. However, Kerrisdale said, "the COVID tailwind will fade and future growth will depend on expansion into already crowded markets."

"Though HubSpot does have some devoted fans, its core technology – a database that can be used to create customized emails and web pages – is nothing special," they added.

Kerrisdale's views are in direct contrast to Goldman Sachs who initiated the company with a Buy rating earlier this month. Goldman analyst Gabriela Borges set a $953 price target on the stock, which at the time implied a 32% upside. In addition, in her research note, Borges said that HubSpot's strategy and execution will drive further upside over the next 5 years after it proved its ability to expand beyond its marketing hub.

Kerrisdale Issues HubSpot Short Report, Calling Out Flawed, Expensive Products
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email