Software makers focused on data analytics and the small- and medium-sized business market won buy ratings from Goldman Sachs on Friday. HubSpot, Tableau, Alteryx and Zendesk stock all rose on the news. Meanwhile, Shopify stock got a neutral rating from the brokerage but still managed to rise.
Goldman Sacks analyst Christopher Merwin initiated coverage on Shopify (SHOP) with a neutral rating voicing concerns over the stock’s current price.
Shopify stock climbed 2.7% to close at 305.05 on the stock market today. Shopify stock has soared 89% from a year ago.
“While we see a very long runway for growth — and growing barriers to entry around platform adoption — we believe valuation is challenging here,” Merwin wrote in a report to clients.
Upbeat On HubSpot, Zendesk Stock
Yet the analyst is upbeat on HubSpot stock and Zendesk stock.
“(Small-to-medium business) vendors are building out platforms that offer a greater breadth of first-party product and third-party integrations,” Merwin wrote. “We think this shift will increase customer retention while also pulling SMB vendors up market, which should also help to improve overall sales efficiency and unit economics.”
HubSpot (HUBS) rose 3.1% to 174.32 on Friday. Zendesk (ZEN) climbed 5.5% to 89.37 and neared a new all-time high.
While the Goldman Sachs analyst doesn’t favor Shopify stock, he does favor data analytics companies such as Tableau (DATA) and Alteryx (AYX).
“As the amount of data produced in enterprises continues to grow at an exponential rate, we see an increasing need for solutions that prepare and analyze data to inform business decisions,” he wrote.