Asana stock continues to lag behind

Last Updated: 7. Februar 2024By

Praised and deeply fallen. The development after the IPO in October 2021 was spectacular: Within only 13 months, the stock rose from $22 to $142. But the record high is now miles away. Yesterday evening, the stock was trading at $17.3. Over the past 12 months, the shares have only gained 7%, significantly behind the technology stock index Nasdaq, which has gained around 40% in the same period.

So it’s time to take a look at the company’s operational development and the current assessment of analysts.

Asana – the specialist for team software The founders behind the US software company are not unknown. Fourteen years ago, Facebook co-founder Dustin Moskovitz and former Google product manager and later ex-Facebook manager Justin Rosenstein launched Asana.

Asana operates a work management platform as a software-as-a-service, allowing individuals and teams to do their work faster and more efficiently. Tasks can be created and assigned to individuals, entire teams can be organized, and project progress can be tracked in detail. All users can see the progress of tasks, post content, and comment. At the same time, the software increases employee engagement by showing how each individual’s work is connected to the organization’s mission.

Asana continues to grow With its business model, Asana was able to play to its strengths, especially during the pandemic. From 2019 to 2023 (note: Asana’s fiscal year ends on January 31), revenues climbed from $76.8 million to $547.2 million.

With its work management platform, the company also continued to grow in the third quarter, which ended in October: Asana’s revenues increased by 17.8% to $166.5 million. The company reported an adjusted net loss of $8.2 million compared to $52.4 million in the same quarter of the previous year.

Asana with high customer growth Meanwhile, Asana continued to show high customer growth. The number of customers spending $100,000 or more increased by 18% year-over-year to 580. Among them are well-known customers such as Amazon, Japan Airlines, Sky, and Under Armour. Among customers with an annual contract value of over $5,000, the company recorded an increase of 14% to 21,346.

Aim for a 19% increase in revenue The results for the fourth quarter will be published in early March. So far, Asana is targeting revenues between $648.5 million and $649.5 million for the full year, representing a 19% increase. The adjusted operating loss is expected to be between 26 and 27 cents per share.

Analysts mostly recommend holding the stock Although the stock has significantly underperformed the broader market in the last 12 months, analysts are generally cautious. According to data provider Tipranks, 12 analysts cover the stock. Of these, only 3 recommend buying the shares. The vast majority (6 analysts) consider the stock a hold, while 3 Wall Street bankers give a sell rating.

Currently, the stock is expected to trade at 6 times the expected revenue, with a market value of $3.92 billion. Analysts do not expect the company to turn profitable until 2028 (Source: Seeking Alpha).

The average target price is $20.45, approximately 18% above the current price level.

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