Shares of BigCommerce Holdings (NASDAQ:BIGC) were falling today after a handful of analysts initiated coverage of the company, with some of them saying the company's share price may be overvalued right now.
As a result, BigCommerce's share price fell by as much as 19.8% in morning trading. As of 11:51 a.m. EDT, the company's share price was down 16.4%.
Morgan Stanley analyst Stan Zlotsky initiated coverage of BigCommerce today with an underweight rating and price target of $52. Zlotsky said the rating was "all about the valuation, not the opportunity," but investors reacted negatively to Zlotsky's report and drove down BigCommerce's stock.
Jefferies analyst Samad Samana initiated coverage as well, with a hold rating and a price target of $130, and Truist Financial analyst Terry Tillman started coverage with a hold rating and $132 price target.
While some of the analysts said the company has plenty of potential for more growth, they also indicated the company's meteoric stock price rise since its IPO at the beginning of August means the stock's valuation is too high.
Even with the company's stock price drop today, BigCommerce's shares are still up 50% since the beginning of this month. But today's wild swing shows just how volatile this stock is right now. Just six days ago the company popped by as much as 37% on news that BigCommerce's platform would be used, along with others, to facilitate online sales through Facebook's Instagram app. The next day, the company's stock popped once again. With such wild stock price swings between last week and today, it appears many BigCommerce investors are reacting to daily news instead of investing in this company for the long haul.