BofA Securities Gives Figma a Neutral Rating with a $85 Price Target

Summary

BofA Securities has initiated coverage of Figma (FIG) with a Neutral rating and an $85 price target, citing its strong position in the $36 billion digital design industry. Figma’s shares have dropped from a peak of $143 to around $65. Analysts expect Q2 revenue of $250M, up 40% YoY, and a non-GAAP EPS of $0.09. Key areas to watch include gross margins, AI product strategy, and enterprise penetration.247wallst

Impact Analysis

So basically, BofA’s neutral rating on Figma with an $85 target is a balancing act between acknowledging its strong market position and the high valuation risks. The stock’s dramatic fall from $143 to $65 post-IPO reflects market skepticism about its lofty price-to-sales ratio of 36, despite a 41% YoY revenue growth in Q2Motley Fool+ 2. The interesting part isn’t just the growth, but the pressure on margins and the lack of immediate AI monetization, which could weigh on near-term performanceZhitong+ 2. Everyone’s focused on the growth story, but the real question is whether Figma can justify its valuation amidst fierce competition and insider sellingSina Finance+ 2. I’d read this as a cautious stance from BofA, suggesting that while Figma’s long-term prospects are promising, the current price might already reflect much of that optimism. Watch for execution on AI strategies and enterprise penetration as potential catalysts or pitfalls.