Bernstein Starts GitLab Inc at Outperform

Bernstein Starts GitLab Inc at Outperform
(Updated - September 12, 2023 6:21 AM EDT)

Bernstein analyst initiates coverage on GitLab Inc (GTLB) with a Outperform rating.

The analyst comments "With software eating the world, cloud and digital transformations, and now LLM AI, expectations are exuberant for software. Add to that agile development transition and an expected nearly 50% rise in number of global developers by 2030 and it appears software development tools would be a large exciting growth story to invest in......but there are few high-growth $1B+ revenue pure-play software vendors selling pick-axes to the gold rush in the form of software development, security, and operations tools for cloud native continuous integration and deployment ("DevSecOps CI/CD"). We already cover some of the largest (Atlassian, Datadog), but few others are near their scale and growth persistence. Why are there so few breakouts? Many hypotheses could emerge, for instance: it's hard to succeed vs. hyperscalers (e.g., Microsoft (NASDAQ: MSFT ) GitHub), competition from new startups (e.g., CircleCI), or maybe open source ruined the economics."

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