Analysts Stocks

      Daily Update - March 31, 2023

      Selected highlights of the day

      By: Matthew Otto

      Braze reported its fiscal year and fourth quarter 2023 results.

      In the fourth quarter, the revenue increased by 40% YoY to $98.7 million, driven primarily by new customers, upsells, and renewals. The subscription revenue was $94.8 million, while professional services and other revenue were $3.9 million. The GAAP gross margin was 66.1%, and the non-GAAP gross margin was 67.0%. Braze’s dollar-based net retention for all customers for the trailing 12 months ended January 31, 2023, was 124%, compared to 128% for the same period in the previous year. The company also entered into an agreement to acquire North Star, Braze’s exclusive reseller in the Australia and New Zealand markets.

      For the fiscal year 2023, the revenue increased by 49.3% YoY to $355.4 million, driven primarily by new customers, upsells, and renewals. The subscription revenue was $338.4 million, while professional services and other revenue were $17.1 million. The GAAP gross margin was 67.4%, and the non-GAAP gross margin was 68.5%. The GAAP operating loss was $148.1 million, while the non-GAAP operating loss was $69.5 million. Braze ended the year with total cash and cash equivalents, restricted cash, and marketable securities of $482.7 million.

      Braze has provided its guidance for the first quarter and full fiscal year 2024

      Projecting continued growth in revenue. For the first quarter of 2024, the company expects revenue to be in the range of $104 million to $105 million, representing year-over-year growth of 22% to 23%. For the full fiscal year 2024, Braze anticipates revenue to be in the range of $441 million to $445 million, reflecting year-over-year growth of 24% to 25%. The company also expects non-GAAP operating margin to improve by 300 basis points in fiscal year 2024, compared to fiscal year 2023. Braze’s acquisition of North Star, its exclusive reseller in the Australia and New Zealand markets, is expected to close in the first quarter of 2024 and contribute approximately $1 million to $2 million to revenue for the remainder of fiscal year 2024.

      • Patrick Walravens from JMP Securities reiterates a Market Outperform on Braze and a $46 price target.
      • Scott Berg from Needham reiterates a Buy rating and a $50 price target.
      • Brian Schwartz from Oppenheimer maintains an Outperform rating and raises the price target from $30 to $36.
      • Brent Bracelin from Piper Sandler maintains an Overweight rating and raises the price target from $33 to $40.

      IN8bio’s

      outlook appears positive, with promising clinical results and ongoing progress in their pipeline. The company’s lead clinical programs, INB-100 and INB-200, have shown durable and favorable responses in leukemia and glioblastoma patients, respectively. They also obtained FDA clearance for their INB-400 Investigational New Drug application and plan to initiate a Phase 2 clinical trial for this therapy targeting newly diagnosed GBM. Additionally, IN8bio is leveraging their knowledge of gamma-delta T cell biology to drive innovation in next-generation chimeric antigen receptor (CAR) technology, with promising preclinical data from their INB-300 platform. Overall, the company has several upcoming milestones and events, and they remain committed to advancing their innovative gamma-delta T cell therapies to help patients in need.

      • EF Hutton analyst Tony Butler reiterates his Buy rating on IN8bio and maintains a price target of $8.
      • HC Wainwright & Co. analyst Swayampakula Ramakanth also reiterates a Buy rating a price target of $14.

      BlackBerry

      Announced its fourth-quarter fiscal 2023 results, reporting total revenue of $151 million. The company’s IoT revenue was $53 million, cybersecurity revenue was $88 million, and licensing and other revenue was $10 million. Non-GAAP basic loss per share was $0.02, while GAAP basic loss per share was $0.85, mainly due to a non-cash goodwill and long-lived asset impairment charge. BlackBerry’s cybersecurity business unit faced macro and supply chain challenges, with the timing of several large government deals slipping into later quarters. However, the company’s IoT business unit set a new record for QNX design wins, with a royalty backlog reaching $640 million. BlackBerry announced the new patent sale transaction with Malikie Innovations Limited for up to $900 million and was recognized as a 2023 Gartner Peer Insights Customers’ Choice for Unified Endpoint Management (UEM) tools.

      Reported a fourth-quarter EPS of  loss of two cents which exceeded the analyst estimate of eight cents.

      • Daniel Chan from TD Securities upgrades BlackBerry from Reduce to Hold, Chan announces a $4 price target for BlackBerry

      SMTC

      Earlier this week, Semtech reported its unaudited financial results for the fourth quarter and fiscal year 2023, which ended January 29, 2023. The highlights for the fourth quarter included completing the acquisition of Sierra Wireless, recording record 10G PON net sales, and LoRa-enabled net sales of $40.8 million. The fiscal year 2023 saw record Semtech Organic net sales of $741.5 million, a combined Semtech and Sierra Wireless net sales of $756.5 million, and a record LoRa-enabled revenue of $187 million, up 40% year-over-year. Semtech also announced non-GAAP diluted earnings per share of $2.80, a record figure.

      No outlook was provided.

      Yesterday,

      • Stifel analyst Tore Svanberg maintained a Buy rating and lowered his price target from $40 to $37.
      • B. Riley Securities analyst Craig Kennison reiterated a Buy rating and maintained a $52 price target.
      • Susquehanna analyst Christopher Rolland maintained a Neutral rating and lowered the price target from $32 to $30.

      Today,

      • Benchmark analyst Cody Acree reiterates Semtech with a Buy rating and maintains a $45 price target.
      • Baird analyst Craig Ellis maintains an Outperform rating and lowers the price target from $48 to $40.