Bigcommerce Gets Reality Check from Morgan Stanley after Rally By

© Reuters.

By Christiana Sciaudone —   Bigcommerce Holdings sank 15% after analysts initiated coverage without much enthusiasm. 

The stock is trading around $109.30, down 24% since hitting a high last week. 

Morgan Stanley (NYSE:) rated the stock underweight with a price target of $52, saying that the stock’s valuation implies “highly elevated levels of growth and present meaningful downside risk if results do not meet expectations,” Morgan Stanley’s Stan Zlotsky wrote, according to Seeking Alpha. Morgan Stanley was the lead underwriter on BigCommerce’s IPO. 

The company’s initial public offering priced at $24 on Aug. 4, and shares reached a peak of $141 on Aug. 27. 

Truist initiated Bigcommerce with a hold rating and a $132 price target, and Raymond James gave it a market perform rating, also on valuation, and did not set a price target, The Fly reported. 

Raymond James’s Brian Peterson also cited valuation, noting that shares are trading at 65 times estimated 2021 revenue. He recommends waiting for a more attractive entry point. 

Truist’s Terry Tillman had a more positive take on Bigcommerce. The company can sustain improved sales growth given its “differentiated open SaaS ecommerce platform, investments and market share gains, The Fly said. 

The continued move away from physical stores and toward e-commerce could drive higher gross merchandise value trends, Tillman said. 




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