Alkami Technology (ALKT) Stock Forecast & Price Target

Alkami Technology Inc. has revised its FY25 revenue expectations to a range of $443-$447 million, indicating a growth rate of 32.7-33.9% year-over-year, which is an improvement from previous forecasts. This positive outlook is primarily driven by a robust subscription revenue growth of approximately 27% year-over-year, accounting for over 95% of the company's total revenue. Additionally, the company achieved a gross margin of 64.3%, which represents a significant expansion of approximately 260 basis points year-over-year, attributed to enhanced operational efficiencies and reduced hosting costs.

Alkami Technology Inc. is exposed to significant risks stemming from consolidation within the banking industry, which could lead to the loss of customers and negatively impact bookings and revenue growth. Furthermore, adverse trends in financial institutions' profit margins may result in reduced IT spending, further straining Alkami's revenue potential. Additionally, unfavorable capital market conditions pose liquidity risks that could necessitate a reevaluation of the company’s growth targets if access to capital becomes increasingly limited.