Please ensure Javascript is enabled for purposes of website accessibility

Why Stock Got Crushed Today

By Jon Quast - Updated Jun 3, 2021 at 11:34AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Wall Street is lowering its expectations, but the company is raising its own outlook.

What happened

Shares of enterprise-software company (AI -0.87%) got crushed on Thursday after the company announced full-year results for its fiscal 2021. Wall Street seemed disappointed, with at least five analysts lowering their price targets for the stock. As a result, the stock was down 10% as of 11 a.m. EDT today.

So what

For fiscal 2021, grew revenue 17% year over year to $183.2 million, ahead of guidance and analysts' expectations. This is a young company with relatively few customers, meaning customer growth is a key indicator for the long-term health of the business. On that front, ended its fiscal year with 89 enterprise customers, up 82% from this time last year -- great progress.

A visibly tired and frustrated investor closes their eyes while computer monitors display down stock charts.

Image source: Getty Images.

Still, analysts seemingly wanted more, as evidenced by the action they're taking today. Analysts from Piper Sandler, Needham, Wedbush, and more are all lowering their price targets for the stock, according to The Fly. However, most price targets are still significantly higher than where the stock trades today. For example, Needham lowered its price target from $195 per share to $146, still over 110% implied upside.

Now what now enters its fiscal 2022, with management guiding for revenue of $243 million to $247 million, which represents between 32.6% and 34.8% year-over-year growth. That's a significant acceleration from its 17% revenue growth in fiscal 2021. This rosy outlook implies the company can keep winning new business.

To that end, had an important announcement today: The U.S. Air Force will officially be doing more business with the company. " has delivered on their commitments to RSO [rapid sustainment office] in the first year of our partnership," said Nathan Parker, the deputy program executive officer for Air Force RSO. Earning this praise from such a high-profile customer should give shareholders optimism that this artificial-intelligence company can deliver on its accelerated revenue guidance in the coming year.

Jon Quast has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends, Inc. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned, Inc. Stock Quote, Inc.
$21.73 (-0.87%) $0.19
Piper Sandler Companies Stock Quote
Piper Sandler Companies
$132.69 (0.04%) $0.05

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/18/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.