Canaccord Downgrades Commerce.com (CMRC) to Hold

Canaccord analyst David Hynes Jr. downgraded Commerce.com (NASDAQ: CMRC) from Buy to Hold with a price target of $3.00 (from $6.00).

The analyst comments "We are downgrading Commerce.com to HOLD from BUY following a Q2 report that further pushes out the prospect of a return to sustainable growth. The quarter itself was fine, in our view: revenue of $84.5M landed at the low-end of guidance, ARR increased 2%, non-GAAP operating income exceeded the high end (9.6% margin), and NRR improved sequentially for the third consecutive quarter to 95.8%. The problem is the outlook. Management reduced the midpoint of its full-year revenue guidance by $18M, with the revised forecast now implying a modest revenue growth decline for the year. Roughly half of the reduction reflects continued softness in B2C replatforming and a more cautious 2H bookings assumption, while the remainder relates to a deliberate decision to concentrate on fewer, more strategic partners, which limits some near-term revenue opportunities. That may improve revenue quality over time, but it does not change the near-term reality that growth continues to move in the wrong direction."

For an analyst ratings summary and ratings history on Commerce.com click here. For more ratings news on Commerce.com click here.

Shares of Commerce.com closed at $3.41 yesterday.

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