GitLab started at Buy by Rosenblatt on AI tailwinds, upsell potential
Investing.com | Author Pratyush Thakur
Published Jul 15, 2025 11:03AM ET
Investing.com -- Rosenblatt started coverage of GitLab with a Buy rating and a $58 price target given company’s strong positioning in the evolving software development landscape and emerging opportunities tied to generative AI.
Analysts see GitLab benefiting from both the increasing complexity of application development and the widespread adoption of AI-assisted coding.
While generative AI may commoditize parts of the coding process, Rosenblatt argues it ultimately drives more code creation, benefiting platforms like GitLab that manage the full software development lifecycle.
The firm also flagged meaningful upside from GitLab’s push to upsell its higher-tier “Ultimate” plans and expand adoption of new AI-based add-on products.
Only about a quarter of GitLab’s paying users are currently on Ultimate, leaving room to grow recurring revenue across its 10,000-plus customer base.
Margins are also expected to expand meaningfully, with adjusted operating margin projected to reach the mid-teens next year and longer-term targets above 30%.
Rosenblatt expects GitLab to generate $939 million in revenue in fiscal 2026, up 24% year-on-year, and sees non-GAAP earnings of $0.75 per share.
The $58 price target implies a 36% return and values the stock at 7.8 times estimated FY27 revenue.
“We believe GitLab has established itself as one of the two leading providers of comprehensive software development platforms, with over 30m registered users, and has broadened into many adjacent areas and additional personas, just in time to make the Company robust (and perhaps even anti-fragile) to the AI wave,” analysts at Rosenblatt said.
Get The News You Want
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.