Analysts Initiate Coverage On WalkMe, Note Upside Potential Betting On Digital Transformation

Goldman Sachs analyst Christopher Merwin initiated coverage of WalkMe Ltd (NASDAQ:WKME) with a Buy rating and $47 price target.
The price target signifies a 52.2% upside to the current level.
According to Merwin, WalkMe's distinction lies in the platform's extensiveness irrespective of the application and the numerous use cases via its no-code platform. Digital Adoption will drive the return on the investments from the growing enterprise digitization. He has a conviction on WalkMe's efforts to effectively move upmarket and improvise the business's sales efficiency, which historically has under-indexed relative to SaaS peers due to the higher category creation costs.
BMO Capital analyst Keith Bachman initiated coverage of WalkMe with an Outperform rating and $35 price target, implying a 13.3% upside.
Bachman considers WalkMe well positioned in a relatively new self-help digital market, driving high customer return on investment (ROI). The catalysts include a steady if modest upside to annual recurring revenue, new customer acquisitions, and new product announcements.
JMP Securities analyst Patrick Walravens initiated coverage of WalkMe with an Outperform rating and a $39 price target, implying a 26.3% upside potential.
Walravens views WalkMe as an attractive opportunity for long-term capital appreciation. The company's digital adoption platform helps to use and deploy software quickly. It dominates in an attractive market that could be worth $34 billion. It also has an opportunity to drive growth as annual recurring revenue growth plummeted from 47% in Q1 to 25% in Q4 due to the pandemic.
Citi analyst Tyler Radke initiated coverage of WalkMe with a Buy rating and a $40 price target, implying a 29.5% upside opportunity.
Radke sees WalkMe as a derivative yet strategic play on the adoption of digitization and software-as-a-service (SAAS). The digital adoption platform helps organizations drive ROI. Radke orthodoxly predicts a $12 billion greenfield market opportunity with several sources of upside.
KeyBanc analyst Michael Turits initiated coverage of WalkMe with an Overweight rating and a $42 price target, implying a 36% upside.
Turits assumes strong demand drivers for WalkMe as a high ROI solution for growing digital transformation prompted software complexity. He sees a significant greenfield opportunity and adjacencies like automation and digital experience analytics.
Barclays analyst Raimo Lenschow initiated coverage of WalkMe with an Overweight rating and a $36 price target, implying a 16.5% upside.
Lenschow describes WalkMe as the market leader in the emerging digital adoption platform market. He estimates the company to drive the annual recurring revenue growth from the mid-20% range in 2020 to the mid-30% range by 2022 as it builds its ecosystem and expands its sales coverage and channel partner network.
Price action: WKME shares closed higher by 4.78% $30.89 on Friday.

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