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Informatica stock forecast after smashing FQ3 expectations

on Dec 1, 2021
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  • Informatica shares on Wednesday advanced by 5.68%.
  • The stock had plunged more than 8% on Tuesday after reporting earnings.
  • The company outperformed FQ3 revenue and earnings expectations.

On Wednesday Informatica Inc. (NYSE:INFA) shares gained by 5.68% to trim Tuesday’s losses. The stock plunged more than 8% despite announcing better-than-expected fiscal third-quarter results before markets opened.

Informatica posted FQ3 non-GAAP earnings per share of $0.23, thus outperforming the consensus for analyst expectations of $0.17. In addition, its GAAP EPS of $0.01 surpassed the average analyst estimate of -$0.05, while revenue for the quarter increased by 10.6% from the same quarter a year ago to #361.81 million, exceeding estimates by $1.43 million.

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Informatica stock has surged more than 17% since shares started trading at the New York Stock Exchange on the 27th of October.

Is it safe to buy Informatica shares?

From an investment perspective, Informatica shares trade at a reasonable price-sales ratio of 6.44, making the stock an exciting option for value investors.

On the other hand, analysts expect its bottom line to improve by 8.40% this year, relatively in line with top-line growth forecasts.

Overall, the stock seems to have several blacks to fill before gaining significant investor interest. Therefore, it may be best to monitor the performance in Q4 before betting on its valuation and growth.

Source – TradingView

Technically, Informatica shares seem to have recently bounced back to recover from Tuesday’s sharp decline. 

However, the stock is yet to reach overbought conditions, thus leaving room for more upward movement. As a result, investors could target extended gains at about $35.23, while $32.17 and $30.54 are crucial support levels.