Software company MongoDB (MDB) is set to report its Q4 earnings results on March 5 after the market closes. Analysts are expecting earnings per share to come in at $0.66 on revenue of $520.62 million. This equates to a 23.3% decrease in EPS but a 13.7% increase in revenue on a year-over-year basis. However, it’s worth noting that MDB has been beating earnings estimates for years now, and often by wide margins.
And there are reasons to believe that this streak will continue. Indeed, four-star Guggenheim analyst Howard Ma expects the company to report a 20% increase in revenue for the current quarter, which is clearly higher than the consensus estimate mentioned above. Such a strong beat would undoubtedly push up the EPS figure as well past expectations.
Ma’s bullish outlook is due to the strong usage growth MongoDB has been seeing from customers that are major cloud computing providers. As a result, he increased his price target for MDB stock from $300 to $325 per share while keeping his Buy Rating. Therefore, it is still possible for EPS to come in higher than last year’s figure.
What Do Options Traders Anticipate?
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. Indeed, the at-the-money straddle suggests that options traders expect a large 14.3% price move in either direction. This estimate is derived from the $257.50 strike price, with call options priced at $16.95 and put options at $20.
Is MDB Stock a Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MDB stock based on 24 Buys, three Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 36% decline in its share price over the past year, the average MDB price target of $372.38 per share implies 44% upside potential.
