Investors have shown increased interest in GitLab Inc. (NASDAQ: GTLB) as stock traders acquired a significant volume of call options on Tuesday. A total of 61,667 call options were purchased, marking a remarkable increase of 285% from the average daily volume of 16,025 call options. This surge in trading activity reflects heightened speculation about the company’s future performance.
Analysts Adjust Ratings and Price Targets
Recent research reports indicate a mixed outlook for GitLab from Wall Street analysts. On September 5, 2023, Barclays lowered its price target for GitLab from $47.00 to $44.00, assigning an “equal weight” rating. Similarly, Capital One Financial reduced its rating from “overweight” to “equal weight,” with a target of $46.00 per share as of July 16, 2023.
Conversely, several analysts maintain a more optimistic view. Rosenblatt Securities reiterated a “buy” rating with a target price of $58.00 on September 4, 2023. Raymond James Financial adjusted its target price from $60.00 to $55.00, while Mizuho downgraded its rating from “outperform” to “neutral” with a $52.00 target as of October 7, 2023.
Currently, GitLab has received two “Strong Buy” ratings, eighteen “Buy” ratings, seven “Hold” ratings, and one “Sell” rating. According to MarketBeat, the consensus rating for the company stands at “Moderate Buy,” with a projected target price of $58.83.
Institutional Activity and Stock Performance
Institutional investors have also made notable adjustments to their holdings in GitLab. In the first quarter, Cambridge Investment Research Advisors Inc. acquired a new stake valued at approximately $200,000. Envestnet Asset Management Inc. increased its stake by 3.9%, now owning 307,749 shares worth $14.46 million.
Cerity Partners LLC raised its holdings by 32.7% during the same period, bringing its total to 72,973 shares valued at $3.43 million. Xponance Inc. increased its position by 6.6%, while Arizona State Retirement System raised its holdings by 2.1%. Collectively, institutional investors and hedge funds own approximately 95.04% of GitLab’s stock.
On Tuesday, GitLab’s stock price remained stable at $46.19 during mid-day trading, with 942,801 shares exchanged compared to an average volume of 3,879,789. The company’s stock has fluctuated significantly over the past year, reaching a low of $37.90 and a high of $74.18. The current market capitalization stands at $7.70 billion, with a price-to-earnings ratio of -1,154.78.
GitLab’s latest quarterly earnings report, released on September 3, 2023, revealed an earnings per share (EPS) of ($0.03), falling short of the consensus estimate of $0.16 by ($0.19). However, the company reported revenue of $236.00 million, exceeding expectations of $227.20 million. Year-over-year revenue growth was recorded at 29.2%, despite a negative return on equity of -2.71% and a negative net margin of -0.55%.
Looking ahead, GitLab has set fiscal year 2026 guidance at EPS between 0.820 and 0.830, with third-quarter 2026 guidance ranging from 0.190 to 0.200 EPS. Analysts forecast an average EPS of -0.31 for the current fiscal year.
GitLab Inc. develops software aimed at enhancing the software development lifecycle, catering to clients across the United States, Europe, and the Asia Pacific. Its flagship offering, the GitLab DevOps platform, consolidates various stages of the DevOps lifecycle into a single application, promoting efficiency and control.
As the trading landscape evolves, GitLab’s performance will continue to attract attention from investors and analysts alike, reflecting broader trends in the tech sector.
