Oppenheimer Upgrades Monday, Wix, SentinelOne on AI Growth Potential
Translated & summarized from Bizportal by baba
Oppenheimer has upgraded Monday.com, Wix, and SentinelOne to its "Outperform" list, citing their potential to capitalize on AI growth. The firm removed Lemonade, Cellebrite, and SolarEdge. Oppenheimer sees Monday.com monetizing AI agents, Wix expanding with its Base44 platform, and SentinelOne benefiting from increased AI-driven security needs. The upgrades come as Oppenheimer believes market fears about AI's impact have created buying opportunities in these software companies.
The story in 7 lines · by baba
- Oppenheimer upgraded Monday.com, Wix, and SentinelOne to "Outperform" due to AI growth potential.
- The firm sees Monday.com charging for AI agent work and Wix expanding with its Base44 platform.
- SentinelOne is expected to benefit from increased demand for security solutions driven by AI.
- Oppenheimer believes market fears have created opportunities in these software companies.
- Monday.com's stock is up 27% from Oppenheimer's previous target, with a new target of $115.
- Wix's Base44 platform reached a $100 million annual recurring revenue run rate.
- SentinelOne has a price target of $27, 25% above its current price.
Oppenheimer has reinstated Monday, Wix, and SentinelOne to its "Outperform" list, identifying opportunities for software companies to leverage artificial intelligence as a growth engine, particularly those combining AI integration with profitability and positive cash flow. The firm removed Lemonade, Cellebrite, and SolarEdge from the list.
For Monday.com, Oppenheimer sees potential in charging for AI agent work in addition to user licenses. For Wix, the firm points to its Base44 platform and expansion beyond website building into app development. SentinelOne is expected to see increased demand for its security solutions due to the growing use of AI. Oppenheimer believes that initial fears about AI negatively impacting software companies have created opportunities, and these firms are now demonstrating business strategies to address the threat.
Despite concerns about high interest rates impacting future earnings, Oppenheimer highlights that companies already generating cash are less affected than growth-oriented firms. Monday.com, which has seen its stock drop 39% year-to-date but reported 22% revenue growth in its last reported quarter, is transitioning to a model that combines subscriptions with AI credits. Its AI product ARR has doubled, now representing 17% of its total ARR additions, and it holds approximately $1.07 billion in net cash. Oppenheimer has set a price target of $115 for Monday.com, a significant increase from its previous $90 target.
Wix's Base44 platform, which allows app creation via text prompts and connects Wix's payment and commerce infrastructure to external sites and apps, has achieved a $100 million annual recurring revenue run rate. Oppenheimer believes this expands Wix's market beyond website building and could improve profitability. However, Wix has recently moved to net debt following a significant share buyback. SentinelOne's inclusion is based on the expectation that increased AI usage will create new security needs, with the company expanding beyond endpoint protection into cloud, data, and AI security. Oppenheimer has a $27 price target for SentinelOne, about 25% above its current price.
Oppenheimer's analysis suggests the market may be overly pessimistic about some of these stocks. For sustained recovery, these companies must demonstrate that their new AI-driven opportunities outweigh any potential damage to their existing businesses. Tower, Nova, and Camtek remain on the list, with Oppenheimer also identifying opportunities in the software layer that translates AI infrastructure investments into customer-facing tools.