‘AI orchestrator’ GitLab shares gain new bull on Wall Street Via Investing.com

Investment firm Baird began research coverage on shares of GitLab on Monday with an Outperform rating and a $59 price target. The move comes amid Baird analysts’ growing confidence in GTLB’s potential to grow and gain market share in the DevSecOps sector.

Gitlab Inc (NASDAQ: ), which Baird also calls the “AI orchestrator,” is developing a platform that integrates artificial intelligence (AI) and advanced security features in a cloud-native architecture and is seen as well-positioned to meet demand growing for secure and efficient software development solutions.

The firm notes that GitLab’s success in securing high-value annual contracts, particularly in its security-focused Ultimate tier, contributes more than 46% of its total annual recurring revenue (ARR).

In addition, the company’s strategic expansion of AI and security capabilities is expected to drive continued market share growth and improved operational efficiency and margins. This is further supported by GitLab’s elevated guidance for fiscal 2025, reinforcing the company’s trajectory for robust long-term growth and highlighting growth potential.

Founded in 2011, GitLab has grown from an open-source project to become a leading platform in the DevSecOps space.

The company’s single-app approach has been a game-changer in the industry, accelerating software delivery while integrating security into the workflow.

“We are initiating coverage of GitLab due to its leadership in DevSecOps, strong AI-driven innovations, and strategic positioning in an expanding total addressable market, meeting the growing demand for efficient, secure, end-to-end software development solutions,” Baird analysts. said.

The company’s $59 price target on the stock reflects an enterprise value to sales (EV/Sales) ratio of approximately 9.8x estimated 2025 earnings, which is higher than the peer group’s average multiple of approximately 8.8x EV/ Sales.

Baird said potential risks to its bullish outlook include the possibility of AI-driven disruption, increased competition from larger cloud service providers (CSPs) and concerns about vendor lock-in, among other factors.