Revised Q4 Guidance Raises UBS’ MeridianLink Stock Target By Investing.com

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UBS on Tuesday raised its price target on MeridianLink (NYSE: MLNK) to $17.50 from its previous target of $16.00, while maintaining a Sell rating on the stock. The adjustment comes as MeridianLink provided an update on its financial outlook for the fourth quarter of 2023.

MeridianLink announced expected fourth-quarter revenue of $73.5 million to $74.5 million, consistent with its previous guidance range of $73 million to $77 million. However, this forecast is $1 million short of the interim goal of $75 million. In line with its revenue outlook, the company expects adjusted EBITDA to range from $30 million to $31 million for the period.

This adjusted EBITDA forecast suggests a margin of approximately 41% at the midpoint, which is significantly higher by approximately 900 basis points compared to the margin implied by previous guidance of 32%. Additionally, this represents an improvement of approximately 850 basis points compared to the previous year.

“It’s encouraging to see MeridianLink’s EBITDA margin exceeding 40% for the first time since Q1 2022, but we’d like to better understand the demand environment and the nature of the company’s EBITDA margin outperformance in Q4 before we expect sentiment to turn more positive. .,” UBS said.

InvestingPro Insights

Following UBS’ updated MeridianLink price target, the market reacted with a variety of indicators. According to Investing Pro According to the data, MeridianLink’s market capitalization is currently $1.44 billion. Despite UBS’ cautious stance, the company’s revenue growth has been steady, up 6.42% over the past 12 months as of Q3 2023. This was further strengthened by a slight quarterly increase of 6.6% in the third quarter of 2023.

But the company’s profitability metrics present a more nuanced picture. As of Q3 2023, the P/E ratio (adjusted) for the last 12 months is noticeably negative at -100.48, reflecting the difficulties MeridianLink has faced in achieving profitability. This matches one of the following: Investment Pro Tips This highlights the company’s lack of profitability over the past 12 months. Nonetheless, analysts predict that the company will be profitable this year, which could be a turning point for the company.

Other Investment Pro Tips MeridianLink’s stock is currently in oversold territory, according to RSI, which suggests it could attract the attention of potential investors looking for an entry point. It’s worth noting that there are eight more. Investment Pro Tips This may provide additional insight into MeridianLink’s performance and prospects. Subscribers can access these tips and more detailed analysis by visiting: Investing Pro Use coupon code at https://www.investing.com/pro/MLNK Pro Newz 24 Save an extra 10% on annual or biennial Pro and Pro+ subscriptions.

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