Analyst Sanjit Singh of Morgan Stanley maintained a Hold rating on Domo (DOMO – Research Report), with a price target of $7.00.
Sanjit Singh has given his Hold rating due to a combination of factors related to Domo’s financial performance and future outlook. The company reported flat revenue growth year-over-year for the third consecutive quarter, which indicates a lack of momentum in increasing sales. While there was a positive development in backlog growth driven by new partnerships, this has not yet translated into a return to revenue growth in the fiscal year 2026 outlook.
Despite the challenges in revenue growth, Domo’s operating margins showed improvement, and the subscription revenue outperformed expectations. However, the guidance for the upcoming quarters suggests a continuation of modestly declining revenue. The company’s efforts in building partnerships and improving customer retention are promising, but the lack of significant consumption growth keeps the outlook cautious. As a result, Sanjit Singh remains neutral, acknowledging the limited downside risk but also the absence of strong growth catalysts.
In another report released today, D.A. Davidson also initiated coverage with a Hold rating on the stock with a $8.00 price target.