HubSpot (NYSE:HUBS) Shares Gap Down - Here's Why

Key Points

• HubSpot shares gapped down premarket — after closing at $232.75 the stock opened at $214.66 and last traded near $208.07 on volume of about 339,576 shares.
• Analysts remain broadly positive with 26 Buy ratings (2 Holds, 1 Sell) and an average price target of $412.39, even as several firms trimmed their targets (e.g., Oppenheimer, Wells Fargo, Barclays).
• The company beat quarterly EPS and reported revenue up 20.4% year-over-year, but the stock carries a high valuation (PE ≈ 244.5) and is trading below both its 50‑day and 200‑day moving averages.

HubSpot, Inc. (NYSE:HUBS - Get Free Report)'s stock price gapped down prior to trading on Thursday . The stock had previously closed at $232.75, but opened at $214.66. HubSpot shares last traded at $208.07, with a volume of 339,576 shares.

Wall Street Analysts Forecast Growth

A number of analysts have recently weighed in on HUBS shares. Citigroup reiterated a "buy" rating on shares of HubSpot in a research note on Friday, April 10th. Oppenheimer cut their price objective on shares of HubSpot from $550.00 to $350.00 and set an "outperform" rating on the stock in a research note on Wednesday, February 4th. Wells Fargo & Company cut their price objective on shares of HubSpot from $600.00 to $350.00 and set an "overweight" rating on the stock in a research note on Thursday, February 12th. Morgan Stanley reiterated an "overweight" rating on shares of HubSpot in a research note on Thursday, February 12th. Finally, Barclays cut their price objective on shares of HubSpot from $525.00 to $300.00 and set an "overweight" rating on the stock in a research note on Thursday, February 12th. Twenty-six equities research analysts have rated the stock with a Buy rating, two have given a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat, HubSpot has an average rating of "Moderate Buy" and an average price target of $412.39.

HubSpot Price Performance

The stock's fifty day moving average is $245.05 and its 200-day moving average is $332.69. The stock has a market capitalization of $11.23 billion, a PE ratio of 244.46, a P/E/G ratio of 3.18 and a beta of 1.44.

HubSpot (NYSE:HUBS - Get Free Report) last announced its quarterly earnings results on Wednesday, February 11th. The software maker reported $3.09 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $2.99 by $0.10. HubSpot had a net margin of 1.47% and a return on equity of 3.64%. The firm had revenue of $846.75 million for the quarter, compared to the consensus estimate of $830.65 million. During the same period in the prior year, the firm posted $2.32 earnings per share. The firm's quarterly revenue was up 20.4% compared to the same quarter last year. On average, analysts forecast that HubSpot, Inc. will post 3.62 EPS for the current year.

Insiders Place Their Bets

In other HubSpot news, insider Erika Ashley Fisher sold 841 shares of the stock in a transaction on Wednesday, February 4th. The shares were sold at an average price of $238.01, for a total transaction of $200,166.41. Following the transaction, the insider directly owned 10,119 shares of the company's stock, valued at $2,408,423.19. This trade represents a 7.67% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, Director Brian Halligan sold 8,500 shares of the stock in a transaction on Tuesday, March 17th. The shares were sold at an average price of $262.75, for a total transaction of $2,233,375.00. Following the transaction, the director directly owned 370,558 shares in the company, valued at approximately $97,364,114.50. The trade was a 2.24% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold 18,191 shares of company stock worth $4,671,932 over the last three months. 4.00% of the stock is currently owned by insiders.

Hedge Funds Weigh In On HubSpot

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. lifted its holdings in HubSpot by 6.4% during the third quarter. Vanguard Group Inc. now owns 5,736,765 shares of the software maker's stock valued at $2,683,659,000 after purchasing an additional 345,524 shares in the last quarter. Price T Rowe Associates Inc. MD lifted its holdings in HubSpot by 36.5% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 4,581,922 shares of the software maker's stock valued at $1,838,727,000 after purchasing an additional 1,224,424 shares in the last quarter. Pictet Asset Management Holding SA lifted its holdings in HubSpot by 13.1% during the first quarter. Pictet Asset Management Holding SA now owns 2,188,191 shares of the software maker's stock valued at $533,993,000 after purchasing an additional 252,604 shares in the last quarter. State Street Corp lifted its holdings in HubSpot by 3.7% during the fourth quarter. State Street Corp now owns 1,191,843 shares of the software maker's stock valued at $478,287,000 after purchasing an additional 42,948 shares in the last quarter. Finally, AQR Capital Management LLC lifted its holdings in HubSpot by 117.6% during the fourth quarter. AQR Capital Management LLC now owns 1,188,981 shares of the software maker's stock valued at $477,138,000 after purchasing an additional 642,545 shares in the last quarter. 90.39% of the stock is owned by hedge funds and other institutional investors.

HubSpot Company Profile

HubSpot, Inc is a software company that develops a cloud-based customer relationship management (CRM) platform designed to help organizations attract, engage and delight customers. Its primary business activities center on providing integrated marketing, sales and customer service tools that support inbound marketing strategies, content management, lead nurturing, sales automation and customer support workflows.

The company's product suite is organized around modular “hubs” built on a central CRM: Marketing Hub, Sales Hub, Service Hub, CMS Hub and Operations Hub.

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