Freshworks (NASDAQ:FRSH) Trading Up 5.8% - Here's What Happened

Key Points

• Freshworks shares rose 5.8% on Tuesday, trading as high as $10.69 after closing at $10.17 the prior day, with about 5.57 million shares changing hands.
• Several analysts recently turned more cautious on the stock, including downgrades from Wall Street Zen, Weiss Ratings, and Oppenheimer, while Morgan Stanley cut its price target to $13.00. The current consensus rating is Hold with an average price target of $12.18.
• Freshworks reported Q1 revenue of $228.63 million, topping estimates and rising 16.5% year over year, while EPS matched expectations at $0.11. The company also disclosed insider sales, including transactions by its CAO and a director under pre-arranged trading plans.

Shares of Freshworks Inc. (NASDAQ:FRSH - Get Free Report) shot up 5.8% on Tuesday . The company traded as high as $10.69 and last traded at $10.7550. Approximately 5,571,282 shares were traded during mid-day trading, a decline of 48% from the average session volume of 10,623,600 shares. The stock had previously closed at $10.17.

Analysts Set New Price Targets

A number of research firms recently issued reports on FRSH. Wall Street Zen downgraded shares of Freshworks from a "buy" rating to a "hold" rating in a research note on Saturday, May 9th. Weiss Ratings downgraded shares of Freshworks from a "sell (d+)" rating to a "sell (d)" rating in a report on Thursday, May 7th. Morgan Stanley decreased their target price on shares of Freshworks from $15.00 to $13.00 and set an "equal weight" rating on the stock in a research report on Monday, May 11th. Oppenheimer lowered Freshworks from an "outperform" rating to a "market perform" rating in a research report on Thursday, March 19th. Finally, Citigroup reissued a "market outperform" rating on shares of Freshworks in a research note on Tuesday, June 2nd. One analyst has rated the stock with a Strong Buy rating, six have given a Buy rating, seven have given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the company has a consensus rating of "Hold" and an average price target of $12.18.

Freshworks Trading Up 5.0%

The stock has a market capitalization of $2.95 billion, a PE ratio of 17.23 and a beta of 0.88. The business's 50 day moving average is $9.23 and its 200 day moving average is $9.38.

Freshworks (NASDAQ:FRSH - Get Free Report) last posted its quarterly earnings data on Tuesday, May 5th. The company reported $0.11 earnings per share for the quarter, hitting analysts' consensus estimates of $0.11. Freshworks had a net margin of 20.69% and a return on equity of 4.27%. The company had revenue of $228.63 million for the quarter, compared to analyst estimates of $223.63 million. During the same period in the prior year, the company posted $0.18 EPS. The firm's revenue for the quarter was up 16.5% on a year-over-year basis. Freshworks has set its FY 2026 guidance at 0.610-0.630 EPS and its Q2 2026 guidance at 0.130-0.130 EPS. As a group, analysts anticipate that Freshworks Inc. will post -0.02 EPS for the current year.

Insider Buying and Selling

In related news, CAO Philippa Lawrence sold 3,470 shares of the business's stock in a transaction on Monday, July 6th. The stock was sold at an average price of $10.13, for a total transaction of $35,151.10. Following the completion of the transaction, the chief accounting officer owned 456,144 shares in the company, valued at $4,620,738.72. The trade was a 0.75% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Jennifer H. Taylor sold 6,618 shares of the company's stock in a transaction on Thursday, July 2nd. The shares were sold at an average price of $10.44, for a total value of $69,091.92. Following the completion of the transaction, the director directly owned 62,673 shares in the company, valued at $654,306.12. This trade represents a 9.55% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders sold 27,236 shares of company stock valued at $270,331. Insiders own 8.54% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of the company. Summit Securities Group LLC bought a new stake in Freshworks during the 4th quarter valued at $26,000. IFP Advisors Inc increased its stake in shares of Freshworks by 954.9% during the fourth quarter. IFP Advisors Inc now owns 2,152 shares of the company's stock valued at $26,000 after buying an additional 1,948 shares during the period. Cullen Frost Bankers Inc. bought a new stake in shares of Freshworks in the fourth quarter valued at about $36,000. Allworth Financial LP raised its holdings in shares of Freshworks by 479.9% in the fourth quarter. Allworth Financial LP now owns 3,201 shares of the company's stock valued at $39,000 after acquiring an additional 2,649 shares in the last quarter. Finally, EverSource Wealth Advisors LLC lifted its stake in Freshworks by 427.6% in the second quarter. EverSource Wealth Advisors LLC now owns 4,479 shares of the company's stock worth $67,000 after acquiring an additional 3,630 shares during the period. Institutional investors own 75.58% of the company's stock.

About Freshworks

Freshworks, Inc is a global provider of cloud-based customer engagement software designed to help businesses streamline customer support, sales, marketing, and IT service operations. The company's integrated suite of solutions enables organizations of all sizes to deliver seamless experiences across multiple channels, including email, chat, phone, and social media. Freshworks' platform is built on modern, user-friendly interfaces and offers native automation, AI-powered insights, and analytics to improve efficiency and customer satisfaction.

The company's flagship product, Freshdesk, serves as a helpdesk solution for customer support teams, while Freshservice addresses IT service management needs.

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