HubSpot: A Breakout in Cloud Marketing

08/26/2019 5:00 am EST

Focus: TECHNOLOGY

Leo Fasciocco

Investment Columnist and Publisher, Ticker Tape Digest

HubSpot (HUBS), based in Cambridge, Mass., provides a cloud-based marketing and sales software platform, notes Leo Fasciocco, breakout stock specialist and editor of Ticker Tape Digest.

With annual revenues of $513 million, the company's software platform features integrated applications to help businesses attract visitors to their websites, convert visitors into leads and close leads into customers.

The integrated applications include social media, search engine optimization, blogging, website content management, marketing automation, e-mail, sales, customer relationship management and analytics. Its products include HubSpot Marketing, HubSpot CRM and HubSpot Sales.

HUBS topped the consensus quarterly estimate the past four quarters by 12 cents a share, 11 cents, 7 cents and 12 cents. Analysts have been raising their estimates.

This year, analysts are forecasting a 57% jump in net to $1.40 a share from the 89 cents the year before. Looking out to 2020, profits are projected to climb 32% to $1.84 a share from the anticipated $1.40 this year.

The stock coming public back in late 2014 at $36. The shares rallied to $60 by late 2015 and then went into a long-term base.

Technically, the stock broke out in early 2017 and since then has been trending aggressively higher. It is now at all-time high having made a fivefold move since 2016.

The stock has just broken out from its 15-week flat base. That move carried the stock to a new all-time high. We see more upside.

We are targeting the stock for a move to $230. A protective stop can be placed near $192. We caution that with a very high p/e ratio of 142, the stock is only suitable for very aggressive bulls.

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