Barclays Reiterates Equal Weight On Duck Creek Technologies, Lowers Price Target

Barclays analyst Saket Kalia reiterated an Equal Weight rating on Duck Creek Technologies Inc's DCT following the Q3 results.
He reduced the price target from $49 to $43. The new price target implies a 4.3% upside at the current level.
DCT beat the revenue consensus by 6.5% at $67.9 million, up 26% year-on-year. It hit the EPS consensus by 400% at $0.03.
Subscription revenue rose 56% Y/Y to $33.6 million, Services revenue grew 6% Y/Y to $25.6 million, License revenue increased 15% Y/Y to $2.5 million, and Maintenance revenue grew 4% Y/Y to $6.3 million.
SaaS annual recurring revenue rose 64% Y/Y to $124.1 million.
The gross margin expanded 252 basis points to 59.2%.
The legacy contract roll-off happened as expected, Kalia's research note stated. It created a $6 million $8 million headwind on subscription on top of the quarter's lower net new annual recurring revenue.
Price action: DCT shares traded lower by 2.77% at $40.07 on the last check Friday.