Domo, Inc. (NASDAQ: DOMO), a burgeoning player in the technology sector, specifically in the application software industry, is catching the eye of individual investors with a compelling potential upside of 18.67%. Based in American Fork, Utah, Domo operates a modern AI and data products platform that spans across North America, Western Europe, Australia, Japan, and India, connecting organizational data and insights seamlessly.
With a market cap of $642.79 million, Domo has seen its share price fluctuate within a 52-week range of $6.62 to $17.57. Currently priced at $15.59, the stock is nearly at the midpoint of its one-year high and low. A negligible price change of 0.09 (0.01%) suggests a period of stability, albeit in a broader context of market fluctuations.
Despite the absence of traditional valuation metrics like P/E Ratio and PEG Ratio, Domo’s forward P/E stands at a staggering 779.50, reflecting investor expectations of future earnings growth despite current profitability challenges. The company’s revenue growth of 1.70% indicates a slow, yet positive trajectory in sales expansion, while an EPS of -1.95 highlights ongoing net income challenges.
Domo’s financial health is bolstered by a robust free cash flow of $56.16 million, providing a cushion for operational flexibility and potential growth investments. However, the lack of dividend yield and a payout ratio of 0.00% might deter income-focused investors looking for regular returns.
Analysts provide a mix of sentiment with four buy ratings and two holds, and notably, no sell ratings. This indicates a general optimism around Domo’s future performance. The target price range of $15.00 to $21.00, with an average target of $18.50, suggests room for price appreciation, aligning with the calculated potential upside of 18.67%.
From a technical standpoint, Domo’s stock is trading near its 50-day moving average of $15.08, well above its 200-day moving average of $10.44. This upward trend in moving averages could signify bullish momentum. The RSI (14) is at 46.93, indicating a neutral position, while a MACD of 0.07 above the signal line at 0.00 suggests a potential positive momentum in the near term.
Domo’s strategic partnership with Altis Consulting underscores its commitment to enhancing data solutions for smarter decision-making and measurable business outcomes. This collaboration aims to leverage transformative data insights that can propel businesses toward enhanced operational efficiency and strategic growth.
For investors eyeing the technology sector, Domo presents a unique proposition of growth potential backed by innovative technology and strategic partnerships. However, the high forward P/E ratio and negative EPS warrant a cautious approach, as the company navigates through profitability challenges. As Domo continues to harness its AI-driven platform capabilities, investors will be keenly watching for signs of scalability and financial improvement.
