JPMorgan downgraded Globant S.A.’s (GLOB) stock from ‘Overweight’ to ‘Neutral’ and slashed its price target to $78 from $108, citing weaker-than-expected revenue guidance for fiscal 2025 and mounting uncertainty in the company’s growth outlook.
The downgrade came in the wake of Globant’s second-quarter (Q2) earnings update, which signaled a slower growth trajectory ahead. The firm noted that the revenue projections create a more difficult environment for achieving positive growth by fiscal 2026.
The company lowered its FY2025 revenue outlook to at least $2.445 billion, from $2.464 billion earlier, in line with the consensus estimate, as per Fiscal AI data. Globat sees Q3 revenue of at least $615 million, also matching the consensus estimate.
Globant S.A. stock tumbled over 14% on Friday mid-morning. However, on Stocktwits, retail sentiment around the stock remained in ‘extremely bullish’ territory while message volume improved to ‘extremely high’ from ‘high’ levels in 24 hours.
The stock saw an 860% surge in user message count in 24 hours, as of Friday morning. A bullish Stocktwits user said they are adding a small quantity of the stock.
In a note to clients, JPMorgan said that Globant’s previous reputation for delivering premium growth and consistent execution now appears ‘challenged.’ The firm pointed to macroeconomic headwinds and a delay in customers’ decision-making in an uncertain economic climate, which are weighing on investor confidence in the stock’s near-term potential.
“While we have delivered strong growth for many years, we have observed a more tempered demand environment over the last few quarters,” said CFO Juan Urthiague in the Q2 earnings call.
Globant S.A. stock has lost over 68% year-to-date and over 65% in the last 12 months.
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