Oppenheimer Believes SPS Commerce (SPSC) Still Has Room to Grow

Oppenheimer analyst Koji Ikeda maintained a Buy rating on SPS Commerce (SPSC) today and set a price target of $112. The company’s shares closed yesterday at $94.66, close to its 52-week high of $100.68.

Ikeda commented:

“SPS Commerce delivered solid 4Q results and initiated 2019 guidance above consensus. Highlights include: 1) another quarter of consistent execution, 2) expanding EBIDTA margins; 3) good net-new recurring customer adds; 4) healthy cash flow generation; and 5) acquisition of CovalentWorks. On balance, growth in the analytics business is expected to remain soft in 2019, putting a higher emphasis on fulfillment to drive the growth necessary to achieve the revenue targets. Bottom line: While the retail macro could remain challenging in 2019, we believe the good execution management has been delivering will likely continue in the future, which leads us to believe the odds are high the business eclipses its 2020 financial targets, which should support valuation. Reiterate Outperform. Raise PT to $112 (from $95).”

According to TipRanks.com, Ikeda is a 5-star analyst with an average return of 39.0% and a 97.7% success rate. Ikeda covers the Technology sector, focusing on stocks such as Coupa Software Inc, BlackLine Inc, and Liveperson.

SPS Commerce has an analyst consensus of Moderate Buy, with a price target consensus of $112.

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SPS Commerce’s market cap is currently $1.64B and has a P/E ratio of 225.38. The company has a Price to Book ratio of 5.27.

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SPS Commerce, Inc. engages in the provision of cloud-based supply chain management solutions company, which network-proven fulfillment, sourcing, and item assortment management solutions, along with comprehensive retail performance analytics to thousands of customers worldwide.

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