Citi upgraded Asana’s (ASAN) rating to Buy/High Risk from Neutral/High Risk while maintaining its $16 price target on the stock.
Shares of Asana, which operates a work management software platform, rose about 4% premarket on Thursday.
“We see an opportunity for new leadership to improve S&M [Sales & Marketing] spend efficiency from bottom quartile closer to the median based on delivered results from both new CEO Rogers and CFO Parekh in prior roles, helping support potential top-line reacceleration and further margin improvements,” said analysts led by Steven Enders.
The analysts see additive growth potential from AI Studio, which they conservatively estimate will drive +1 point of growth to Annual Recurring Revenue, or ARR, in fiscal year 2027. They also see a potential acceleration along with adding an AI consumption element to the model, which should prove helpful in combating pessimism around the seat-based model/other generative AI, or GenAI, tooling fears.
“While early, our conversations with implementation partners suggest strong initial interest in AI Studio, positive feedback on delivered ROI, and a differentiated offering,” said Enders and his team.