Upland Software’s Strategic Restructuring and AI Focus Drive Buy Rating
David Hynes from Canaccord Genuity has maintained a Buy rating on Upland Software with a price target of $5.00, citing improved financial and operational standing due to strategic restructuring and AI focus. Upland's recent quarter showed 3% adjusted organic growth and 32% Adjusted EBITDA margins. The company has reduced its net leverage ratio to 3.8x and has $23M in cash. Upland aims for 5% organic growth and 31% EBITDA margins by 2027, despite a slight revenue guidance adjustment for 2025. Craig-Hallum also maintains a Buy rating with a $3.50 price target.
In a report released today, David Hynes from Canaccord Genuity maintained a Buy rating on Upland Software, with a price target of $5.00.
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David Hynes has given his Buy rating due to a combination of factors that highlight Upland Software’s improved financial and operational standing. The company has undergone significant restructuring, including asset divestitures and debt refinancing, which have resulted in a clearer and more focused business model. Upland’s operations are now largely concentrated in enterprise knowledge and content management, with a growing emphasis on AI integration and a cohesive product set. This strategic focus has led to positive core organic growth, with a reported 3% adjusted organic growth and Adjusted EBITDA margins of 32% in the recent quarter.
Moreover, Upland’s financial health is on an upward trajectory, evidenced by a reduction in net leverage ratio to 3.8x and substantial liquidity with $23M in cash and a $30M undrawn revolver. The company has also secured significant deals with major clients, indicating its enhanced competitive position. Looking ahead, Upland aims for continued organic growth and margin expansion, with expectations of reaching 5% organic growth and 31% EBITDA margins by 2027. Despite a slight adjustment in revenue guidance for 2025, the overall outlook remains positive, supported by ongoing innovation and expanded distribution channels. These factors contribute to the Buy rating, as the valuation remains attractive.
According to TipRanks, Hynes is an analyst with an average return of -6.1% and a 38.96% success rate. Hynes covers the Technology sector, focusing on stocks such as Atlassian, Salesforce, and Workday.
In another report released on November 7, Craig-Hallum also maintained a Buy rating on the stock with a $3.50 price target.
