Cantor Fitzgerald sets Docebo stock overweight with $35 target

On Monday, Cantor Fitzgerald initiated coverage of Docebo Inc (TSX:DCBO). (NASDAQ:DCBO), an AI-driven learning management system platform, with an Overweight rating and a 12-month price target of $35.00. With a market capitalization of $800 million and impressive gross profit margins of 81%, the company shows strong potential in the expansive $60 billion education technology market, noting its capacity to redefine enterprise learning for workforce, partners, and customers. According to InvestingPro data, the company has maintained solid revenue growth of 17% over the last twelve months.

Docebo's platform offers a versatile and user-friendly solution that caters to various enterprise needs, including customer experience and employee experience, with applications ranging from training to enablement and compliance. Cantor Fitzgerald's analysis suggests that Docebo is well-positioned to capitalize on opportunities for revenue growth within its targeted market. InvestingPro analysis indicates the stock is currently undervalued, with analyst targets ranging from $32 to $45.

The firm's optimistic outlook is based on several scenarios, with the high case predicting over 100% upside to Docebo's current valuation, the mid case around 70%, and the low case at 20%. Trading near its 52-week low of $25.50, with a six-month decline of 45%, Cantor Fitzgerald regards the current market valuation as an attractive entry point for investors.

Cantor Fitzgerald's coverage notes that the recent volatility in Docebo's stock price is seen as a temporary setback, and the challenges the company faces are considered manageable. The firm encourages investors to consider Docebo as an under-followed small-cap stock with significant potential for growth as it transitions to an AI-first learning platform. InvestingPro subscribers can access 13 additional investment tips and a comprehensive Pro Research Report for deeper insights into Docebo's financial health and growth potential.

In other recent news, Docebo Inc. reported its first-quarter 2025 earnings, surpassing earnings per share (EPS) expectations with $0.27 per share, compared to the forecasted $0.26. However, the company faced a slight revenue shortfall, reporting $57.3 million against projections. Despite this, Docebo revised its full-year revenue growth guidance downward to 9-10%. Additionally, Docebo achieved FedRAMP Moderate Authorization, allowing it to offer cloud-based learning solutions to U.S. federal agencies, which could expand its reach to state and local government agencies.

In another development, Morgan Stanley downgraded Docebo's stock rating from Overweight to Equalweight, lowering the price target to $32. The firm cited a consistent deceleration in revenue growth trends and potential macroeconomic challenges as reasons for the downgrade. Despite these challenges, Docebo launched new AI tools and announced strategic initiatives aimed at bolstering its market position. The company remains focused on AI-driven innovations and expanding its government market opportunities, anticipating potential benefits from large enterprise deals and the FedRAMP authorization.

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CEO Alessio Artuffo emphasized Docebo's AI-first strategy, highlighting the company's commitment to transforming the learning management system landscape. The company also noted that its partnership with AWS remains strong, with no significant churn expected, as it focuses on enterprise and mid-market segments. As Docebo navigates these developments, it continues to adapt its strategies in response to economic pressures, according to CFO Brandon Farmer.

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