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Now is the time for investors to buy shares of monday.com , according to Morgan Stanley. The firm upgraded the stock to overweight from equal weight but slashed its price target to $260 from $330. However, that updated target still implies 49.3% upside from Monday’s close. Shares tumbled nearly 30% during Monday’s session after monday.com’s second-quarter results came out. While earnings and revenue beat analysts’ expectations, mixed third-quarter guidance and lackluster metrics sent the stock plunging. “Skinnier beat against higher expectations and focus on paid search commentary drove shares meaningfully lower, creating the entry point for which we’ve been waiting,” analyst Josh Baer wrote in a Tuesday note. “With shares -30% on Monday 8/11 after results and -40% over the last month, MNDY has meaningfully underperformed peers.” MNDY 1M mountain MNDY, 1-month The analyst said the stock’s decline over the past month factors in the risks related to artificial intelligence’s effect on search advertising as well as the company’s use of performance marketing. To him, those concerns are “overblown.” “Moving upmarket, expanding to multi-product and shifting to a sales-led growth motion comes with risk, but also comes from a position of strength and represents a large and compelling opportunity. We think monday.com can successfully navigate most of these major changes,” Baer said, adding that this “large opportunity is underpriced.” Shares were poised to reverse course from Monday’s losses, seeing a more than 1% rise in the premarket Tuesday. The stock has plunged more than 45% over the past six months, far underperforming the S & P 500’s more than 5% gain during that timeframe. Most analysts are bullish on monday.com. LSEG data shows that 22 of the 24 who cover the stock rate it a buy or strong buy.
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