What happened
Database company MongoDB (MDB 4.54%) didn't end the week well, with its stock declining by 5% on a Friday when the S&P 500 index basically traded sideways. Moves by two analysts sent some investors heading for the exit.
So what
The first of the two was actually a price-target raise on MongoDB stock. This trigger was pulled by Citigroup's Tyler Radke, who upped his level considerably; it's now $363 per share from the previous $290. Almost needless to say, Radke continued to rate the shares a buy.
There was a major caveat, though. The analyst placed MongoDB stock on a downside, 30-day catalyst watch, noting that it has several vulnerabilities.
Radke is concerned that consumption for the types of services the database company offers continues to be weak. As a result of this and other factors, 2023 could be a relatively disappointing year for its business.
Now what
Separately on Friday, Morgan Stanley analyst Sanjit Singh gave his view on a clutch of notable stocks active in the cloud-services segment, including MongoDB. According to him, "the bar is higher" for companies like the database-solutions specialist and its peers given their recent outperformance on the exchange.
Although he continues to be bullish on their prospects, he feels that other stocks in the segment offer a more favorable risk/reward profile in the near term. He singled out three of them -- PagerDuty, HashiCorp, and Couchbase.
MongoDB has indeed performed well on the market lately, rising nearly 40% in price year to date against the barely over 9% of the S&P 500 index. It's understandable that analysts like Radke and Singh would be concerned about its valuations. However the company -- and more than a few of its contemporaries -- continue to post encouraging growth rates in an environment of sustained and strong demand.
