KeyBanc Reiterates Sector Weight Rating on Bill.com Holdings Inc. (BILL)

KeyBanc analyst Alex Markgraff reiterated a Sector Weight rating and {REMOVEPT} price target on Bill.com Holdings Inc. (NYSE: BILL).

The analyst commented, "BILL reported F3Q revenue ahead of the Street helped by upside in core/spend & expense and to a lesser extent float revenue. Operating margin outperformance came from core/spend & expense revenue upside, but also benefited from gross margin upside resulting from a one-time payment network incentive (~200 bps contribution) and float revenue upside (~$6M more than guide). TPV trends were positive with mgmt/key metrics indicating stability in per customer TPV. Take rate improved noticeably in the quarter, but benefited from AR volume migration to another processor, a tailwind that is expected to be quickly diluted by other volume. Take rate was noted to expand ex-the volume migration tailwind, and guidance (at or better than F1Q level) was reaffirmed. Net adds across core AP and Divvy improved and FI customers contracted as an FI partner churned inactive accounts (presumably immaterial to revenue). No update/details around the impending changes with Bank of America were shared. We exit the quarter more constructive on macro trends across core/ spend & expense and encouraged by what could be the start of success in recent GTM changes. Our FY24/25 revenue/operating margin move higher on F3Q24 results, customer growth, and greater macro stability. Reiterate SW as we look for additional data points on GTM success, the magnitude of underlying take rate improvement, and an indication of resolution between BILL/Bank of America."

For an analyst ratings summary and ratings history on Bill.com Holdings Inc. click here. For more ratings news on Bill.com Holdings Inc. click here.

Shares of Bill.com Holdings Inc. closed at $58.51 yesterday.

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