stock price C3.ai (NYSE:AI) Shares soared after the company announced its quarterly results on Wednesday. The report highlighted that enterprise demand is surging. Artificial intelligence (AI) software. The company's revenue beat Wall Street consensus estimates, and some believe the stock has further upside.
Analysts at Wedbush Securities said: excellent rating The company has raised its price target from $35 to $40, which represents about 10% upside from the current stock price. For investors looking for higher returns over the long term, the target price itself is not important. In this case, Wedbush noted that this quarter demonstrated the company's confidence in its growth story, which is an important signpost for investors.
Reasons why C3.ai stock price is rising
C3.ai reported 18% year-over-year revenue growth. This was a slight acceleration from his 17% increase in the previous quarter. C3.ai CEO Thomas Siebel emphasized on the earnings call that data centers are investing in AI for more than just consumer applications, saying, „The market interest in enterprise AI is staggering. That's the point,“ he said.
Strong demand explains Wedbush's confidence in a growth story that could benefit the stock in the near term. The company has signed several new contracts with major companies including: T-mobile and boston scientificcontinued strong growth by the U.S. government.
The downside for C3.ai is that it continues to report large losses at the end, but profitability should improve as the business continues to grow. The company noted that its customer pipeline increased by 73% year over year.
Management is calling for full-year sales in 2024 to increase by approximately 15% compared to 2023, and expects free cash flow to turn positive in 2025.
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John Ballard I have a position in C3.ai. The Motley Fool recommends C3.ai and T-Mobile US. The Motley Fool has Disclosure policy.
C3.ai stock is heading towards $40, according to this Wall Street analyst. Originally published by The Motley Fool