AI Partnerships And Enterprise Demand Drive Shutterstock's Upward Trajectory, Analysts Say

Truist Securities analyst Youssef Squali maintains Shutterstock Inc SSTK with a Buy rating and raises the price target from $86 to $88.
The analyst remains constructive on SSTK following more robust than expected 1Q23 results and guidance raise for FY23.
SSTK is benefiting from strength in Enterprise, up 35% Y/Y FXN fueled by demand for Studios and growing contributions from existing and new AI partnerships, which should grow over 50% Y/Y in FY23.
The management announced two new long-term deals and a robust pipeline.
SSTK continues transforming itself from a marketplace for stock imagery to an AI-powered creative content and workflow platform with compelling growth and margin prospects, valuation, and sound capital allocation.
Needham analyst Bernie McTernan reiterates Shutterstock with a Buy rating and maintains a $90 price target.
Given the big 1Q beat and only modest raise to FY23 guidance, the analyst believes it sets an achievable bar for the remainder of the year.
On AI, SSTK signed two partnerships in the quarter, noting market pricing for Computer Vision is consistent with the $5 million - $10 million communicated at the recent investor day.
The analyst believes management expressed increased conviction in the breadth of companies needing AI models, which he believes will be a tailwind for SSTK and a key reason to own shares.
Price Action: SSTK shares are trading lower by 5.92% at $65.33 on the last check Wednesday.