+22% in a single week as markets remain flat: These are December’s hidden winners
Investing.com - Cantor Fitzgerald has reiterated its Overweight rating and $240 price target on Atlassian Corporation (NASDAQ:TEAM) following the company’s fiscal first quarter 2026 results. TEAM currently trades at $166.30, with analyst consensus remaining bullish at 1.59 (Strong Buy), according to InvestingPro data.
The software company reported better-than-expected cloud revenue and total revenue growth, with both Jira and Confluence products experiencing seat growth. The results exceeded expectations even after adjusting for accounting benefits related to the end-of-life of data center offerings. Atlassian’s impressive 82.8% gross profit margin and 19.7% year-over-year revenue growth support this strong performance.
Atlassian’s artificial intelligence capabilities now reach 3.5 million monthly active users, representing a 50% quarter-over-quarter increase. Most usage of the company’s Rovo AI features remains on free tiers, suggesting future monetization potential. Despite this growth, InvestingPro data shows the company is not yet profitable over the last twelve months, though analysts predict profitability this year.
The research firm maintained its price target of $240, representing approximately 9 times calendar year 2026 estimated revenue. This valuation compares to Atlassian’s 9.3x one-year and 9.7x three-year next-twelve-months average multiples. With a market capitalization of $43.6 billion, TEAM is currently trading at a high revenue valuation multiple, in line with its historical average.
Cantor Fitzgerald expressed confidence that Atlassian can expand its enterprise presence beyond developers using Jira to other organizational workflow collaboration areas, with accelerating remaining performance obligations and strong cloud performance supporting this view. Despite TEAM’s stock taking a significant 29.6% hit over the last six months, the company holds more cash than debt on its balance sheet, providing financial flexibility to pursue growth opportunities. For deeper insights into Atlassian’s financial health and growth prospects, check out the comprehensive Pro Research Report available on InvestingPro.
In other recent news, Atlassian Corporation reported strong fiscal first-quarter 2026 results, with both revenue and earnings surpassing analyst expectations. The company achieved a 21% year-over-year revenue growth, which was above the anticipated 18% growth. This performance was bolstered by cloud migrations, seat count growth, and upsell performance, as well as a 1.6 percentage point benefit from Data Center end-of-life revenue recognition. Analysts from Mizuho raised their price target for Atlassian to $245, while Truist Securities adjusted their target to $210, maintaining a Buy rating. Piper Sandler and Goldman Sachs reiterated their Overweight and Buy ratings, with price targets of $300 and $260, respectively. Guggenheim also maintained a Buy rating, noting Cloud growth of 26%, which exceeded expectations. The transition from on-premise solutions to cloud-based offerings played a significant role in these results. These developments reflect Atlassian’s ongoing strong performance and strategic growth initiatives.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.