HashiCorp Inc (HCP: NSD) saw its stocks slip by 1% due to an ongoing review by the Federal Trade Commission (FTC) concerning its impending acquisition by International Business Machines, Corp. (IBM).
Stock Target Advisor’s Analysis on HashiCorp:
While the review is still ongoing, HashiCorp’s stock has already registered a slip, albeit a slight one of 1%. Stock Target Advisor rates with a sell rating, with a predicted target price of zero indicating there is no projected price change in the next 12 months. This rating can be seen as a bleed effect of the FTC scrutiny.
Currently 13 analysts covering the HCP stock, the average rating leans towards a ‘Buy’. The target price ranges from a minimum of $24 to a maximum of $38 with an average at $31.05.
HashiCorp: An Overview of Financial Performance
Despite bearing superior revenue growth, high market capitalization, 380.89% and 87.13% (five-year growth sector percentile ranking) respectively, HashiCorp’s financial health shows signs of struggling. Symptoms of this struggle include negative cash flow and free cash flow over the past four quarters, overpricing compared to book value, below-median dividend returns, and poor risk-adjusted returns. These negative signals pose a concern for the investors, asking them to reconsider their investment decision in HCP stock.
The trailing 12 months returns show a capital gain of 23.63%, which is indeed a significant number that portrays a positive picture on the profitability front.
Conclusion:
Despite the FTC’s review, IBM maintains its expectation of closing the deal by the end of 2024. Potential investors must tread with caution when considering HashiCorp stock, taking into account both its risks and opportunities.
Muzzammil is a content writer at Stock Target Advisor. He has been writing stock news and analysis at Stock Target Advisor since 2023 and has worked in the financial domain in various roles since 2020. He has previously worked on an equity research firm that analyzed companies listed on the stock markets in the U.S. and Canada and performed fundamental and qualitative analyses of management strength, business strategy, and product/services forecast as indicated by major brokers covering the stock.
