Software company Expensify Inc (NASDAQ: EXFY ) was initiated with an Underweight rating by JPMorgan analysts in a note on Friday.
The analysts, who did not assign a price target for the stock, said that while the company has attractive fundamentals, it also has a challenging business model.
"While the industry is inherently affected by macro headwinds, long-term growth prospects have helped emerging players attract funding, making the competitive landscape more crowded," explained the analysts.
"We like the Expensify product, which is easy to adapt and integrate with tools already in use by the target audience, but see limited differentiation vs. competitors that aid in easing expense management, bill paying, invoicing, etc."
The analysts added that the tougher macro environment creates lower visibility into revenue and reduces the efficiency of the word-of-mouth, bottom-up customer acquisition model for the company.
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