Braze (NASDAQ:BRZE) Shares Gap Down - Time to Sell?

Key Points

• Braze shares fell sharply, opening at $26.18 after closing at $30.31 and later trading near $25, as investors reacted negatively to the company’s profit outlook despite continued revenue growth.
• Fiscal second-quarter results exceeded expectations, with revenue up 26.2% year over year to $227.2 million and adjusted EPS of $0.19. Braze also raised its full-year fiscal 2027 revenue and EPS guidance, citing AI adoption, enterprise expansion and improved operating leverage.
• Analysts remain broadly optimistic, with a consensus “Moderate Buy” rating and average price target of $37.79, but concerns over slowing near-term profit growth and recent insider selling have weighed on the stock.

Braze, Inc. (NASDAQ:BRZE - Get Free Report) gapped down prior to trading on Wednesday . The stock had previously closed at $30.31, but opened at $26.18. Braze shares last traded at $24.9950, with a volume of 2,010,081 shares.

Trending Headlines about Braze

Here are the key news stories impacting Braze this week:

• Positive Sentiment: Braze reported fiscal Q2 revenue of $227.2 million, up 26.2% year over year and above the $220.3 million analyst consensus. Adjusted EPS of $0.19 also exceeded expectations of $0.16. Braze Reports Strong Fiscal Second Quarter 2027 Results
• Positive Sentiment: The customer-engagement software company raised fiscal 2027 revenue guidance to $910 million–$913 million, versus the $898.4 million consensus, and lifted EPS guidance to $0.64–$0.65 from expectations of $0.35. Management highlighted AI product adoption, enterprise expansion, improving operating leverage and record second-quarter free cash flow. Braze Growth and Guidance Analysis
• Positive Sentiment: Several analysts remained bullish. Stephens raised its price target to $34, Piper Sandler increased its target to $30, and BTIG Research and Citizens JMP maintained positive ratings with $35 targets.
• Neutral Sentiment: For fiscal Q3, Braze projected revenue of $229 million–$230 million and EPS of $0.13–$0.14, both above consensus estimates. However, investors viewed the profit outlook as weaker than anticipated relative to the company’s growth profile.
• Negative Sentiment: The raised full-year outlook and second-quarter earnings beat were overshadowed by concerns about slowing near-term profit growth. This prompted investors to reassess valuation and drove the sharp decline in BRZE despite continued revenue growth and favorable analyst commentary. Braze Stock Plummets After Disappointing Profit Outlook

Analyst Upgrades and Downgrades

BRZE has been the subject of a number of research analyst reports. JPMorgan Chase & Co. lifted their price target on Braze from $33.00 to $35.00 and gave the company an "overweight" rating in a research report on Monday, July 6th. Stifel Nicolaus set a $30.00 price objective on shares of Braze in a research report on Thursday, May 28th. Weiss Ratings reaffirmed a "sell (e+)" rating on shares of Braze in a research note on Tuesday, July 7th. Citizens Jmp reiterated a "market outperform" rating and set a $35.00 target price on shares of Braze in a research report on Wednesday. Finally, Barclays boosted their price target on shares of Braze from $31.00 to $38.00 and gave the stock an "overweight" rating in a research note on Wednesday, September 2nd. One equities research analyst has rated the stock with a Strong Buy rating, nineteen have assigned a Buy rating, one has given a Hold rating and one has assigned a Sell rating to the company. Based on data from MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and an average price target of $37.79.

Braze Stock Down 18.4%

The firm has a market capitalization of $2.78 billion, a P/E ratio of -21.95 and a beta of 0.88. The business's 50-day simple moving average is $27.57 and its 200 day simple moving average is $23.54.

Braze (NASDAQ:BRZE - Get Free Report) last announced its quarterly earnings data on Tuesday, September 8th. The company reported $0.19 earnings per share for the quarter, topping analysts' consensus estimates of $0.16 by $0.03. Braze had a negative net margin of 15.51% and a negative return on equity of 17.52%. The firm had revenue of $227.23 million during the quarter, compared to analyst estimates of $220.27 million. During the same period in the previous year, the business posted $0.15 EPS. The business's quarterly revenue was up 26.2% on a year-over-year basis. Braze has set its FY 2027 guidance at 0.640-0.650 EPS and its Q3 2027 guidance at 0.130-0.140 EPS. Sell-side analysts predict that Braze, Inc. will post -0.78 earnings per share for the current year.

Insider Buying and Selling

In other Braze news, CRO Edward Mcdonnell sold 29,732 shares of the business's stock in a transaction on Monday, August 24th. The shares were sold at an average price of $31.38, for a total value of $932,990.16. Following the completion of the sale, the executive directly owned 409,630 shares of the company's stock, valued at $12,854,189.40. The trade was a 6.77% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CTO Jonathan Hyman sold 42,000 shares of the company's stock in a transaction dated Thursday, August 27th. The shares were sold at an average price of $32.47, for a total transaction of $1,363,740.00. Following the sale, the chief technology officer owned 1,143,219 shares of the company's stock, valued at approximately $37,120,320.93. The trade was a 3.54% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 203,568 shares of company stock worth $6,096,461 in the last 90 days. 12.50% of the stock is owned by company insiders.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently made changes to their positions in BRZE. Dana Investment Advisors Inc. purchased a new stake in shares of Braze in the 4th quarter worth about $1,980,000. Stephens Investment Management Group LLC lifted its position in Braze by 8.7% during the 4th quarter. Stephens Investment Management Group LLC now owns 1,233,143 shares of the company's stock valued at $42,284,000 after acquiring an additional 98,854 shares during the period. Dimensional Fund Advisors LP bought a new stake in Braze during the first quarter worth about $14,294,000. Northwestern Mutual Wealth Management Co. boosted its stake in Braze by 232,716.3% during the fourth quarter. Northwestern Mutual Wealth Management Co. now owns 100,111 shares of the company's stock worth $3,433,000 after acquiring an additional 100,068 shares in the last quarter. Finally, Pathway Capital Management LP purchased a new stake in Braze in the fourth quarter worth about $2,207,000. Institutional investors own 90.47% of the company's stock.

Braze Company Profile

Braze, Inc is a publicly traded software company NASDAQ: BRZE that offers a customer engagement platform designed to help brands build personalized relationships with their users. Founded in 2011 as Appboy by Bill Magnuson, Jon Hyman and Mark Ghermezian, the company adopted the Braze name in 2017 to underscore its focus on fostering strong connections between businesses and consumers. Its cloud-based platform consolidates messaging channels including push notifications, in-app messages, email and SMS, enabling companies to deliver timely, context-driven communications at scale.

The core functionality of Braze's platform centers on data-driven segmentation, customer journey orchestration and real-time analytics.

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