Bank of America reinstated coverage of Figma on Tuesday, assigning the design-software company a Buy rating and a $30 price target. The firm said market anxieties about generative AI undermining Figma's business have been exaggerated, and that the stock's roughly 85% drop from its 52-week high represents an appealing entry point for investors.
Analyst Tal Liani framed the bank's view on AI as "more constructive," arguing that generative tools are "more likely a tailwind, not a headwind" for Figma. Liani pointed out that while AI can speed initial content creation, it may also enlarge the number of people building digital products. That expansion, he said, can lead to greater workflow complexity and in turn reinforce demand for a centralized collaboration platform such as Figma.
Bank of America highlighted early signs that AI is already supporting commercial traction. In the first quarter of 2026, 75% of enterprise customers purchased additional AI credits after exceeding their initial allocations, a behavior the bank interprets as evidence of strong engagement and a willingness to increase spending on AI-enabled features.
The firm also noted resilient enterprise momentum across several metrics. The count of customers generating more than $100,000 in annual recurring revenue rose 48% year-on-year. Net dollar retention sits at 139%, and paid-user growth reached 54%. These figures were cited as indicators of healthy expansion within the enterprise base.
On valuation, Liani observed that Figma trades at about 5 times calendar year 2027 EV/Sales, below a stated peer average of 5.9 times, even though Bank of America characterizes Figma's growth profile as superior. The bank's $30 price target is derived from a multiple of 8 times CY27 EV/Sales.
Bank of America included forward margin assumptions in its model. It projects operating margin and free cash flow margin improving from 9.2% and 11.3% in fiscal 2026 to 13.8% and 16.2% by fiscal 2028, respectively.
Takeaway - Bank of America's reinstatement rests on the view that generative AI will increase the population of creators and the complexity of collaborative workflows, strengthening the need for platforms that centralize design and product development. Early customer behavior and multiple expansion assumptions underpin the bank's valuation and target.