Smartsheet price outlook after guiding FY2022 above the Street forecast

By: Motiur Rahman
Motiur Rahman
Md Motiur enjoys researching how companies are solving challenges the world will face over the coming decades. In his… read more.
on Dec 4, 2021
  • Smartsheet shares on Friday rocketed 8% after reporting FQ3 results.
  • The company announced its most recent quarterly results Thursday after markets closed, beating estimates.
  • It also issued its full-year guidance on revenue and EPS above Street expectations.

On Friday, Smartsheet Inc. (NYSE:SMAR) shares gained nearly 8% after reporting its most recent quarterly results. The company announced its fiscal third-quarter revenue and earnings Thursday after markets closed, outperforming consensus Street expectations. The Application software developer also issued its FY2022 revenue and EPS guidance above estimates.

Smartsheet posted FQ3 non-GAAP earnings per share of -$0.03, outperforming the average Street forecast of -$0.11. In addition, its GAAP earnings per share of -$0.29 outperformed the average analyst estimate of -$0.34, while revenue for the quarter surged by more than 47% from FQ3 last year to $144.63 million, exceeding expectations by $4.7 million.

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Smartsheet now expects to report Fy 2022 revenue in the range of $544 million to $545 million, ahead of the Street forecast of $535.28 million. It also provided an EPS guidance of -$0.32 to -$0.30, compared to the consensus estimate of -$0.39.

Is it too late to buy?

From an investment perspective, Smartsheet shares have now rallied to trade at a steep P/S ratio of 18.59, thus making the stock less attractive to bargain hunters. 

However, with analysts executing its EPS to improve by more than 33% next year, the stock could gain the attention of growth investors.

Source – TradingView

Technically, Smartsheet shares seem to have recently spiked to complete an upward breakout from a descending channel formation.

As a result, the stock avoided falling deep into oversold conditions, creating an opportunity for buyers to ride the rebound.

Therefore, investors could target extended technical rebound profits at about $68.55, or higher at $71.47, while $63.47 and $60.67 are crucial support zones.

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