Truist Securities has reduced its price objective on HubSpot Inc (NYSE:HUBS) to $300 from $650 but maintained a Buy rating on the shares. The move comes as HubSpot trades near $209, roughly 1% above its 52-week low of $207.20 and about 76% below its 52-week high of $881.13.
The sizable downward adjustment in the price target contrasts with Truist's description of HubSpot's most recent quarterly performance as "strong beats across the board," where the company exceeded expectations on both revenue and earnings. InvestingPro data cited in the research shows HubSpot reporting robust 84.1% gross profit margins and 19.2% year-over-year revenue growth.
Truist identified "significant software multiple compression in recent weeks" as the principal reason for trimming its target, even as the firm continued to express confidence in HubSpot's underlying business. InvestingPro's analysis included in the coverage also characterizes the stock as currently undervalued while noting that HubSpot holds more cash than debt on its balance sheet.
On the operational front, Truist highlighted signs of strengthening fundamental metrics at HubSpot, pointing to accelerating net revenue retention and improved AI adoption. The firm cited positive momentum in multi-hub adoption and the company's push upmarket as constructive signals for future growth dynamics.
Looking at guidance, Truist described HubSpot's fiscal year 2026 outlook - 18% reported growth (16% on a constant currency basis) - as a "prudent/positive starting point with solid upside opportunities." The research note added that the company has "multiple ways to win and some defenses from AI disruption fears."
HubSpot's recent analyst coverage shows a pattern of lower price targets across several firms while many continue to acknowledge the company's resilient performance. Needham reduced its target to $300 from $700 after noting HubSpot's strong fourth-quarter results, including 18% constant currency revenue growth that topped Needham's 16% estimate. TD Cowen cut its target to $270 from $370, recognized the company’s consistent performance and 18% revenue growth, and kept a Hold rating.
BMO Capital adjusted its target to $285 from $385, citing solid overall results and maintaining an Outperform rating. Piper Sandler lowered its target to $280 from $400, attributing the move to lower software multiples but retaining an Overweight stance while acknowledging favourable trends in the business. KeyBanc trimmed its target to $340 from $400 and expressed concern that HubSpot's 2026 revenue growth guidance of 16% falls short of the firm’s expectation for a return to 20% growth.
These analyst actions reflect ongoing reassessments of valuation multiples in the software sector alongside continued attention to HubSpot's growth trajectory, margin profile, and AI-related adoption patterns. While Truist and other firms note positive operational trends and conservative guidance with upside potential, the reduced targets underscore the market's reaction to compressed software multiples in recent weeks.
Key points
- Truist lowered its HubSpot price target to $300 from $650 but kept a Buy rating.
- HubSpot reported strong quarterly beats, 84.1% gross margins, and 19.2% year-over-year revenue growth per InvestingPro data.
- Other analysts have trimmed targets - Needham, TD Cowen, BMO Capital, Piper Sandler, and KeyBanc - while many maintain positive or neutral stances.
Risks and uncertainties
- Significant software multiple compression in recent weeks - a market valuation risk that affected price targets.
- Analyst concern that HubSpot's 2026 revenue guidance (16% constant currency) may fall short of higher growth expectations, notably KeyBanc's 20% target benchmark.
- Ongoing sector pressures could continue to influence valuation even if operational metrics remain strong.
Sectors affected include software and broader technology markets, with potential spillover to SaaS investors and equities sensitive to multiple expansion or compression.