Stifel has reduced its price target for JFrog (NASDAQ:FROG) to $52 from $64 while keeping its Buy recommendation on the stock. The analyst action followed an industry-wide reaction to an announcement from Anthropic unveiling Claude Code Security, a limited research preview made available to Enterprise and Team customers.
The Anthropic disclosure prompted a broad sell-off across cybersecurity equities, with many names retreating between 6% and 9%. JFrog experienced an outsized move, with shares sliding roughly 25% to $37.75, making it the most severely affected company within the group.
Over a one-week span the stock dropped nearly 27%, a decline that InvestingPro's analysis now classifies as pushing JFrog into oversold territory and trading beneath its calculated Fair Value. Stifel attributed the abrupt pullback to investor worries about potential future competition in the binary market, while stressing that Claude Code Security, as currently announced, does not touch JFrog's core binary business.
Stifel also noted customer behavior that should temper some competitive concern: many enterprise clients purposefully segregate code and binary repositories from security tooling to reduce operational and security risk. That separation, the firm suggested, helps preserve the defensibility of repository platforms.
On valuation metrics, the shares are trading at approximately 5.5 times enterprise value-to-revenue and about 25 times enterprise value-to-free cash flow on calendar year 2027 estimates. Additional financial metrics highlighted by data from InvestingPro show JFrog with a stronger cash position than debt and gross profit margins of 77%.
Stifel indicated it expects the share price to stabilize around current levels given the underlying growth characteristics of JFrog's core offerings, which continue to benefit from heightened code generation driven by artificial intelligence. Under Stifel's revised target, the stock would be valued near 8 times enterprise value-to-revenue and 40 times enterprise value-to-free cash flow based on calendar year 2027 figures.
Recent company results provide context for those expectations. In the fourth quarter of fiscal 2025 JFrog reported earnings per share of $0.22, beating the consensus estimate of $0.19. Revenue for the quarter came in at $145.3 million versus projected revenue of $138.09 million.
Other brokerages have continued to express confidence in JFrog even as the market reacted. TD Cowen raised its price target to $80 from $75 and maintained a Buy rating, citing cloud growth of 42% that surpassed Street expectations of 32%. Truist Securities reiterated a Buy rating and a $70 price target, pointing to what it called a solid FY25 finish fueled by strong cloud revenue and improving enterprise sales momentum. Collectively, these analyst moves underscore the company’s ongoing performance and cloud expansion.
Note: InvestingPro data referenced above was used to summarize valuation, margin and balance sheet information.