Overview
Bernstein SocGen Group has reduced its price target for HubSpot Inc (HUBS) to $448 from $602, though it left its Outperform rating unchanged as the company approaches its fourth-quarter 2025 earnings announcement. The Q4 report is scheduled for February 11 after the market close.
The analyst action by Bernstein comes against a backdrop of significant share-price pressure. The stock has fallen 40% over the past month amid a wider software sector sell-off and has declined 69.8% over the past year, leaving it trading close to its 52-week low of $223.01. Technical momentum indicators show the stock in oversold territory according to the reported RSI reading.
Bernstein's rationale
Bernstein cited three principal drivers for its revision: market uncertainty about software versus AI narratives, the outlook management provides for fiscal year 2026, and the stock's valuation. The firm noted that AI-related questions remain hard to resolve for many vendors in the software space.
While Bernstein expects HubSpot to deliver solid quarterly results, the firm signaled caution about FY26 guidance, pointing to management's track record of conservative forecasting. The firm suggested that clearing guidance could serve as a clarifying event for the shares.
To reflect the broader step-down in software valuations, Bernstein lowered its target EV/NTM Sales multiple on HubSpot from 7.5x to 5.5x. Even after that adjustment, the firm described the shares' all-time-low valuation as providing a "compelling risk-reward profile" and reiterated HubSpot's standing as a "best-in-class SMB CRM platform."
Financial position and profitability expectations
Data cited in the analysis highlight HubSpot's strong gross margins, reported at 84.1%, and a balance sheet position described as having more cash than debt. The company has not been profitable over the past twelve months, but consensus analyst forecasts referenced show expectations for a return to profitability this year, with an EPS projection of $9.75 for FY2025.
Analysts who follow the name continue to flag the firm's attractive margin profile and cash position as positives in assessing valuation, while noting the sensitivity to guidance and sector multiple compression.
Updates from other brokerages
A number of other sell-side firms have also updated their views recently, illustrating a range of perspectives on HubSpot's near-term demand and longer-term growth trajectory:
- BMO Capital lowered its price target to $385, citing concerns that upside to consensus billings and revenue growth in the December quarter may be limited.
- Stifel trimmed its target to $500, attributing the move to software multiple compression but maintaining a Buy rating and noting improved sentiment among HubSpot partners.
- Raymond James retained an Outperform rating with a $525 target, pointing to a strong finish to 2025 and citing a partner report of growth in the 35% range.
- Citi kept a Buy rating with a $660 price target and placed the stock on a 30-day upside catalyst watch.
- Oppenheimer stayed at Outperform with a $550 target, while flagging mixed demand signals and noting that fourth-quarter new monthly recurring revenue fell short of that firm's internal expectations.
Market reaction and valuation context
The sizable price declines over the past month and year indicate investor sensitivity to both sector-wide valuation compression and company-specific guidance risk. Bernstein's multiple reduction underscores the reassessment of comparable software valuations, while the retained Outperform rating highlights the firm's view that current levels present attractive upside relative to downside.
Investors and analysts will be watching management's FY26 guidance closely when the company reports, as clarity there has been identified as a potential catalyst. The combination of an elevated gross margin profile and a net cash position were cited as factors supporting a favorable risk-return profile despite the near-term uncertainties.
What to watch
- Fourth-quarter 2025 results and the accompanying FY26 guidance provided on February 11 after market close.
- Signals on demand, including new monthly recurring revenue trends and partner ecosystem sentiment.
- Sector multiple direction, particularly how investors continue to price software names amid AI-related debate and broader market moves.
These elements will likely shape near-term trading dynamics and analyst positioning in the days and weeks following the report.