Atlassian (NASDAQ:TEAM) Shares Gap Down - Time to Sell?

Key Points

• Shares gapped down ~10.6% — TEAM opened near $67.20 after a $74.01 close and was last trading around $66.42 on heavy volume, triggering sell-pressure concerns.
• Analysts have materially cut price targets (e.g., Morgan Stanley to $120 from $290; KeyCorp to $130), yet the consensus rating remains a "Moderate Buy" with an average price target of $155.11.
• Operationally Atlassian beat the quarter (EPS $1.22 vs. $1.12 est., revenue $1.59B, +23.3% YoY) but remains unprofitable on margins and ROE (net margin -3.29%, ROE -6.33%), and insiders have sold shares recently.

Atlassian Corporation PLC (NASDAQ:TEAM - Get Free Report)'s share price gapped down before the market opened on Thursday . The stock had previously closed at $74.01, but opened at $67.20. Atlassian shares last traded at $66.4240, with a volume of 1,552,486 shares traded.

Wall Street Analyst Weigh In

Several equities analysts have commented on the stock. KeyCorp lowered their target price on shares of Atlassian from $170.00 to $130.00 and set an "overweight" rating on the stock in a research report on Wednesday, April 1st. Morgan Stanley lowered their target price on shares of Atlassian from $290.00 to $120.00 and set an "overweight" rating on the stock in a research report on Thursday, April 16th. Robert W. Baird set a $140.00 target price on shares of Atlassian in a research report on Friday, February 6th. BMO Capital Markets set a $130.00 target price on shares of Atlassian and gave the stock an "outperform" rating in a research report on Friday, February 6th. Finally, Mizuho lowered their price target on Atlassian from $185.00 to $145.00 and set an "outperform" rating on the stock in a research report on Tuesday, April 14th. Nineteen analysts have rated the stock with a Buy rating, six have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the company currently has an average rating of "Moderate Buy" and a consensus price target of $155.11.

Atlassian Trading Down 10.6%

The company has a market capitalization of $17.45 billion, a price-to-earnings ratio of -91.63 and a beta of 0.99. The company has a 50-day moving average price of $72.65 and a 200-day moving average price of $121.22. The company has a quick ratio of 0.89, a current ratio of 0.89 and a debt-to-equity ratio of 0.62.

Atlassian (NASDAQ:TEAM - Get Free Report) last issued its quarterly earnings results on Friday, February 6th. The technology company reported $1.22 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.12 by $0.10. The company had revenue of $1.59 billion for the quarter, compared to the consensus estimate of $1.54 billion. Atlassian had a negative return on equity of 6.33% and a negative net margin of 3.29%.The firm's revenue was up 23.3% compared to the same quarter last year. During the same period last year, the business posted $0.96 earnings per share. Research analysts predict that Atlassian Corporation PLC will post -0.01 EPS for the current fiscal year.

Insider Transactions at Atlassian

In related news, Director Scott Farquhar sold 7,665 shares of the stock in a transaction dated Friday, February 6th. The shares were sold at an average price of $94.81, for a total value of $726,718.65. Following the completion of the sale, the director owned 275,940 shares in the company, valued at approximately $26,161,871.40. This trade represents a 2.70% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CEO Michael Cannon-Brookes sold 7,665 shares of the business's stock in a transaction dated Wednesday, February 4th. The shares were sold at an average price of $105.14, for a total value of $805,898.10. Following the transaction, the chief executive officer owned 283,605 shares in the company, valued at $29,818,229.70. This represents a 2.63% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 97,993 shares of company stock valued at $11,340,805 in the last ninety days. 36.66% of the stock is owned by company insiders.

Hedge Funds Weigh In On Atlassian

Several institutional investors and hedge funds have recently added to or reduced their stakes in the company. Physician Wealth Advisors Inc. increased its stake in Atlassian by 60.4% during the third quarter. Physician Wealth Advisors Inc. now owns 162 shares of the technology company's stock valued at $26,000 after acquiring an additional 61 shares during the period. GAMMA Investing LLC increased its stake in Atlassian by 12.0% during the fourth quarter. GAMMA Investing LLC now owns 615 shares of the technology company's stock valued at $100,000 after acquiring an additional 66 shares during the period. Snowden Capital Advisors LLC increased its stake in Atlassian by 1.6% during the second quarter. Snowden Capital Advisors LLC now owns 4,464 shares of the technology company's stock valued at $907,000 after acquiring an additional 71 shares during the period. Financial Perspectives Inc increased its stake in Atlassian by 11.7% during the fourth quarter. Financial Perspectives Inc now owns 718 shares of the technology company's stock valued at $116,000 after acquiring an additional 75 shares during the period. Finally, ABN Amro Investment Solutions increased its stake in Atlassian by 3.4% during the third quarter. ABN Amro Investment Solutions now owns 2,452 shares of the technology company's stock valued at $392,000 after acquiring an additional 80 shares during the period. 94.45% of the stock is currently owned by institutional investors.

Atlassian Company Profile

Atlassian Corporation Plc is a software company headquartered in Sydney, Australia, best known for developing collaboration, project management and software development tools. Founded in 2002 by Mike Cannon-Brookes and Scott Farquhar, Atlassian grew from a small engineering-focused team into a publicly traded company after its initial public offering in 2015. The company serves a global customer base that spans small teams to large enterprises across technology, financial services, government and other sectors.

Atlassian's product portfolio centers on tools designed to help teams plan, build and support software and business processes.

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