On Friday, Baird downgraded shares of Sprout Social Inc . (NASDAQ:SPT) from Outperform to Neutral, significantly reducing the price target to $45.00 from the previous $72.00. The adjustment follows Sprout Social's announcement of mixed financial results and a lowered revenue forecast for 2024, which the company attributes to increased enterprise seasonality and challenges in sales execution.
The company's recent earnings call revealed a combination of lowered guidance, withdrawal of certain financial metrics, and inconsistent growth, which Baird's analyst described as a "perfect storm." The absence of a leader for go-to-market (GTM) strategies and changes in sales operations are contributing to uncertainty about the company's future performance.
Baird's revised stance on Sprout Social reflects an expectation that the stock will face ongoing pressure as investors seek evidence of business stability. The company is scheduled to participate in the Baird Global Consumer, Technology & Services (GCTS) Conference, which will take place in June in New York City.
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