PagerDuty (PD) Stock Forecast & Price Target

PagerDuty Inc. has demonstrated strong financial performance, reporting an increase in profitability with operating margins improving by 650 basis points year-over-year, alongside a significant customer base growth, now totaling 15,247 paid customers. The company is also witnessing heightened momentum in customer acquisition and continued success among AI-native users, indicating robust platform engagement and potential for further revenue expansion. With adjusted EBITDA estimates for the upcoming years showing a positive trajectory and expectations for refined growth and margin profiles, PagerDuty is well-positioned to benefit from improved market visibility and increased tech spending.

PagerDuty Inc. has demonstrated a concerning trend with TTM billings increasing only 4% year-over-year, falling short of the company's expectations and indicating potential struggles in revenue growth. The company's international revenue, while still contributing 29% of total revenue, has shown a deceleration quarter-over-quarter, suggesting challenges in expanding its customer base globally. Furthermore, projections indicate that a decline in technology spending, along with lower renewal and expansion rates, could lead to a reduced revenue growth forecast of 250 basis points lower than initial estimates, which is likely to adversely affect the company's valuation multiples.