TechTarget (TTGT) shares plummeted 7.63% during Tuesday's intraday trading session, as investors reacted to a significant price target cut by Needham analyst Joshua Reilly. The analyst reiterated a Buy rating on the stock but lowered the price forecast from $40.00 to $25.00, citing macroeconomic headwinds and potential challenges in the company's sales and marketing sectors.
Reilly's cautious outlook stems from expectations that TechTarget's management will likely provide conservative guidance for fiscal year 2025. The analyst anticipates the company to align its FY25 guidance with consensus estimates of $512 million in revenue (representing a modest 3.4% year-over-year growth) and $98 million in adjusted EBITDA. Key focus areas for investors include the progress of integrating recent acquisitions and the realization of $25 million in cost synergies.
Adding to investor concerns are potential changes in TechTarget's business segment structure. The company may combine its Brand & Content with Intent & Demand segments, while reporting Intelligence & Advisory separately. Despite these challenges, TechTarget's unique B2B purchase intent marketing platform and its expansion into new markets could provide growth opportunities once global IT spending rebounds. However, the immediate market reaction suggests that investors are prioritizing near-term headwinds over long-term potential.
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