Everbridge (EVBG) Down 15% on BofA “Downgrade” and 150 Price Target
Shares of Everbridge (EVBG), one of our oldest positions, are trading off more than 10% today after Bank of America analysts downgraded the stock to neutral from buy and trimmed their price target to 150 from 162. The analysts surmise that Everbridge’s average selling prices are likely falling as the pandemic curbs needs for corporate clients given the growing work-from-home trend. The company does serve more than corporate clients, and in fact the demand from cities, states and countries likely remains, partially due to the pandemic. It’s also worth mentioning that a 150 price target implies 35% upside from where Everbridge is trading today. This note isn’t overly concerning to me as I think it likely has merit when taken at face value. That said, and as BofA notes, the long-term story here remains intact, there just might be some turbulence to work through in the near term. The chart has essentially forecasted the same as EVBG has been trading between 115 and 165 since Q1 results were released in early-May. Perhaps more concerning right now is that, coupled with a dreadful day in the market, this note has helped to push shares of EVBG below support at 115 (stock at 110). Management reports Q3 results next Thursday and I expect to continue to hold on until we get the result and guidance. HOLD
