Noor Ul Ain Rehman
2 min read
In This Article:
On June 4, Bank of America Securities analyst Michael Funk reiterated a Buy rating for Asana, Inc. (NYSE:ASAN), reducing the price target to $21 from $23. The analyst based the rating on the company’s future prospects and financial performance, as reported in the fiscal Q1 2026 earnings released on June 3.
The analyst reasoned that despite a minute drop in revenue guidance led by macroeconomic challenges, the company’s financial results exceeded expectations in terms of operating margin and revenue.
A financial professional at his desk, working intently on his wealth management software.
Revenue for the quarter underwent a 9% year-over-year growth to $187.3 million, while Q1 GAAP operating margin improved 15 percentage points year-over-year. Asana, Inc. (NYSE:ASAN) also reported its first positive non-GAAP operating margin in company history, expanding non-GAAP operating margin by 1,300 basis points year over year.
According to the analyst, these trends indicate the company’s potential to effectively manage profitability, which is a positive sign for investors.
The Asana AI Studio is also showing promising potential, as it exceeded the $1 million ARR threshold. The analyst expects it to be a prominent growth driver in the fiscal year’s latter half, further supporting the Buy rating.
While we acknowledge the potential of ASAN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
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Disclosure: None.
