Latest news with #Confluent
Yahoo
3 days ago
- Business
- Yahoo
1 Under-the-Radar AI Stock With 50% Upside Potential
In today's increasingly digital world, the speed at which data is captured, processed, and acted upon is critical. That's where Confluent (CFLT), a technology company valued at a market capitalization of $8.1 billion, enters the picture. Founded by the original creators of Apache Kafka, Confluent provides a cloud-native data infrastructure platform that enables organizations to connect, store, and process real-time data streams at scale. Confluent stock has dipped 14% year-to-date (YTD), compared to the S&P 500 Index's ($SPX) gain of 1.9% YTD. Nonetheless, Wall Street believes CFLT stock has more than 50% upside potential over the next year. Let's see whether the stock is currently a buy. Confluent follows a hybrid business model, providing both a self-managed software platform and a fully managed cloud offering. Subscriptions and usage-based pricing, which are increasingly popular among large enterprises due to their flexibility and scalability, generate revenue for the company. Is Palantir Stock Poised to Surge Amidst the Israel-Iran Conflict? CoreWeave Stock Is Too 'Expensive' According to Analysts. Should You Sell CRWV Now? Grains, Unrest, & Gold: What Middle East Tensions Mean for Your Portfolio Now Our exclusive Barchart Brief newsletter is your FREE midday guide to what's moving stocks, sectors, and investor sentiment - delivered right when you need the info most. Subscribe today! Despite a cautious enterprise cloud-spending environment, the company's first-quarter results for fiscal 2025 showed increasing momentum in subscription revenue, hybrid deployments, and new-generation offerings such as Apache Flink and Tableflow. Total revenue increased 25% year on year to $271.1 million, with adjusted earnings increasing by an impressive 60% to $0.08 per share. During the Q1 earnings call, management emphasized that the company's focus on long-term platform expansion is beginning to pay off, despite the fact that macroeconomic pressures remain, particularly in large-scale enterprise consumption. Net retention reached 117% in Q1, demonstrating customer trust in Confluent's platform. Confluent generated $260.9 million in subscription revenue during Q1, up 26% year on year (YOY) and accounting for 96% of total revenue. Confluent Cloud, a fully managed, cloud-native product, generated $142.7 million, a 34% increase YOY. Furthermore, demand for hybrid and on-premises deployments enabled the company's self-managed Confluent Platform to generate a healthy $118.2 million in revenue, up 18% from the previous year. Management stated that Confluent Platform had its best first-quarter performance in three years. Confluent's growth strategy is heavily reliant on migrating the estimated 150,000 organizations that still use open-source Kafka. Confluent added 340 net new customers during the period, marking its best quarterly performance in three years. Confluent's balance sheet showed $1.9 billion in cash, cash equivalents, and marketable securities at the quarter's end. The company also generated $4.9 million in positive free cash flow (FCF) during the quarter, a sign of cost discipline. Management reaffirmed its fiscal 2025 guidance with cautious optimism. Subscription revenue could increase by 19% to 20%, reaching $1.1 billion. Likewise, adjusted net income per share could be around $0.36 per share, compared to $0.29 in fiscal 2024. Additionally, analysts predict earnings will rise by 30.7% to $0.47 by fiscal 2026. Despite being a small company, Confluent is rapidly growing. Its inclusion in mission-critical workloads is what distinguishes it. This technology is not experimental. In fact, it provides real-time network solutions to a variety of industries, including telecommunications, retail logistics and supply chain, and financial services fraud detection. On Wall Street, CFLT stock is rated as a 'Moderate Buy.' Of the 31 analysts covering the stock, 20 rate CFLT as a 'Strong Buy,' three recommend it as a 'Moderate Buy,' seven call it a "Hold,' and one suggests that it is a 'Moderate Sell.' The average target price of $28.14 per share suggests an upside of 17.5% above current levels. The Street-high target price of $36 implies that shares could rally 50.4% over the next 12 months. As the demand for real-time data infrastructure increases, particularly in artificial intelligence (AI) and edge computing, so will the demand for the Confluent's services. For long-term investors, Confluent provides an appealing combination of secular tailwinds, a deep technical moat, high gross margins, and a strong cloud growth engine. However, as a high-growth stock, it trades at a premium of 66x forward earnings. Consequently, risk-averse investors may want to wait for a better entry point. On the date of publication, Sushree Mohanty did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on
Yahoo
13-06-2025
- Business
- Yahoo
Where Will Confluent Stock Be in 3 Years?
Confluent stock has had a difficult time since late 2021, partly thanks to the business's declining growth rates. The stock is now trading at a reasonable valuation, and it's sitting on a massive addressable opportunity. Confluent's earnings growth is expected to accelerate, and that could be rewarded with healthy gains on the market over the next three years. 10 stocks we like better than Confluent › It has been just under four years since Confluent (NASDAQ: CFLT) made its stock market debut in June 2021. A look at its stock price chart will show that investors in the data streaming specialist have endured a difficult time since November of that same year. Confluent stock was in fine form in 2021 following its initial public offering. However, like many other young tech stocks in late 2021, the stock price began a downhill run late in the year. Some of these stocks eventually recovered. In Confluent's case, the stock lost 46% of its value since its initial public offering (IPO) and 74% when compared to its all-time high. Let's check why that has been the case and see if this cloud computing stock has the ability to regain its mojo and jump higher over the next three years. Confluent was trading at a whopping 37 times sales in 2021, which means that it needed to maintain high growth rates to justify its rich valuation. However, its sales growth rates have been dropping over the years, as we can see from the table below. Fiscal Year Annual Revenue Growth 2021 64% 2022 51% 2023 33% 2024 24% Data source: Confluent quarterly reports. The reduction in Confluent's top-line growth is a big reason why the stock has fallen out of investors' favor. As a result, it is now trading at just under 8 times sales, which is lower than its five-year average price-to-sales ratio of 12. Another thing worth noting is that Confluent's sales multiple is now in line with the U.S. technology sector's average sales multiple. Buying Confluent at its current valuation could turn out to be a smart long-term move, as the company is now sitting on an added catalyst in the form of artificial intelligence (AI). Confluent's cloud-based data streaming platform is used by customers to bring data out of silos and connect it in real time to make decisions quickly. The company's platform finds applications in multiple areas such as inventory management, fraud detection, and customer service. It's now being applied in generative AI and agentic AI applications as well, as Confluent's platform allows customers to use relevant data in real time for training large language models (LLMs) and AI agents. As a result, Confluent is now winning a bigger share of customers' wallets, along with bringing new customers into its fold, which should set the company up for robust long-term growth. Confluent now sees its addressable market exceeding $100 billion this year. That's double its estimated addressable market four years ago. Even better, the accelerated growth in its customer base suggests that it is well on track to capitalize on this massive opportunity. Confluent's overall customer base jumped by 20% year over year in the first quarter of 2025. That was a major improvement over the 9% year-over-year increase in its customer base in the year-ago period. Importantly, Confluent is gaining more business from its existing customers. This can be judged from the company's dollar-based net retention rate of 117%, a metric that compares its annual recurring revenue (ARR) from customers at the end of a quarter to the ARR from the same customer cohort in the year-ago period. So, an ARR of more than 100% suggests that existing customers are spending more money with Confluent. The higher spending by Confluent's older customers is also driving a solid bump in its margins. The company's non-GAAP operating margin increased by six percentage points year over year in Q1. This explains why the company's non-GAAP earnings increased by 60% from the year-ago period to $0.08 per share. The company has guided for $0.36 per share in earnings for 2025, which points toward a 24% increase from last year. However, don't be surprised to see Confluent doing better than that following the healthy increase in Q1, especially considering the pace at which it is adding new customers and encouraging existing ones to spend more money. Not surprisingly, analysts are forecasting an acceleration in Confluent's bottom-line growth over the next couple of years. The stronger growth in Confluent's earnings in 2026 and 2027 points toward better times for the stock over the next three years, as the market could reward this impressive bottom-line jump with healthy gains. As such, buying Confluent right now makes sense from a long-term point of view. The correction in the company's stock price since its IPO has made it a better buy, considering its lucrative end-market opportunity and bright prospects. Before you buy stock in Confluent, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Confluent wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $657,871!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $875,479!* Now, it's worth noting Stock Advisor's total average return is 998% — a market-crushing outperformance compared to 174% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 9, 2025 Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool recommends Confluent. The Motley Fool has a disclosure policy. Where Will Confluent Stock Be in 3 Years? was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-06-2025
- Business
- Yahoo
2 Volatile Stocks with Promising Prospects and 1 to Approach with Caution
Volatility cuts both ways - while it creates opportunities, it also increases risk, making sharp declines just as likely as big gains. This unpredictability can shake out even the most experienced investors. At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. That said, here are two volatile stocks with massive upside potential and one that might not be worth the risk. Rolling One-Year Beta: 1.20 Specializing in online casino gaming and sports betting, Rush Street Interactive (NYSE:RSI) is an operator of digital gaming platforms. Why Does RSI Give Us Pause? Subpar operating margin of 0.5% constrains its ability to invest in process improvements or effectively respond to new competitive threats Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 8.8% for the last two years At $13.82 per share, Rush Street Interactive trades at 42.3x forward P/E. If you're considering RSI for your portfolio, see our FREE research report to learn more. Rolling One-Year Beta: 1.89 Started in 2014 by the team of engineers at LinkedIn who originally built it as an internal tool, Confluent (NASDAQ:CFLT) provides infrastructure software for organizations that makes it easy and fast to collect and move large amounts of data between different systems. Why Does CFLT Stand Out? Winning new contracts that can potentially increase in value as its billings growth has averaged 27.9% over the last year Forecasted revenue growth of 17.4% for the next 12 months indicates its momentum over the last three years is sustainable Healthy unit economics are reflected in its 73.9% gross margin and give it more money to invest in marketing and R&D Confluent is trading at $24.44 per share, or 6.9x forward price-to-sales. Is now a good time to buy? See for yourself in our full research report, it's free. Rolling One-Year Beta: 2.53 Widely regarded as the face of crypto, Coinbase (NASDAQ:COIN) is a blockchain infrastructure company updating the financial system with its trading, staking, stablecoin, and other payment solutions. Why Will COIN Beat the Market? Customers are spending more money on its platform as its average revenue per user has increased by 58.2% annually over the last two years Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 64.5% outpaced its revenue gains Robust free cash flow margin of 25.9% gives it many options for capital deployment, and its improved cash conversion implies it's becoming a less capital-intensive business Coinbase's stock price of $240.03 implies a valuation ratio of 18.7x forward EV/EBITDA. Is now the time to initiate a position? Find out in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.
Globe and Mail
13-06-2025
- Business
- Globe and Mail
Where Will Confluent Stock Be in 3 Years?
It has been just under four years since Confluent (NASDAQ: CFLT) made its stock market debut in June 2021. A look at its stock price chart will show that investors in the data streaming specialist have endured a difficult time since November of that same year. Confluent stock was in fine form in 2021 following its initial public offering. However, like many other young tech stocks in late 2021, the stock price began a downhill run late in the year. Some of these stocks eventually recovered. In Confluent's case, the stock lost 46% of its value since its initial public offering (IPO) and 74% when compared to its all-time high. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More » Let's check why that has been the case and see if this cloud computing stock has the ability to regain its mojo and jump higher over the next three years. Confluent's expensive valuation has been the stock's undoing Confluent was trading at a whopping 37 times sales in 2021, which means that it needed to maintain high growth rates to justify its rich valuation. However, its sales growth rates have been dropping over the years, as we can see from the table below. Data source: Confluent quarterly reports. The reduction in Confluent's top-line growth is a big reason why the stock has fallen out of investors' favor. As a result, it is now trading at just under 8 times sales, which is lower than its five-year average price-to-sales ratio of 12. Another thing worth noting is that Confluent's sales multiple is now in line with the U.S. technology sector's average sales multiple. Buying Confluent at its current valuation could turn out to be a smart long-term move, as the company is now sitting on an added catalyst in the form of artificial intelligence (AI). Confluent's cloud-based data streaming platform is used by customers to bring data out of silos and connect it in real time to make decisions quickly. The company's platform finds applications in multiple areas such as inventory management, fraud detection, and customer service. It's now being applied in generative AI and agentic AI applications as well, as Confluent's platform allows customers to use relevant data in real time for training large language models (LLMs) and AI agents. As a result, Confluent is now winning a bigger share of customers' wallets, along with bringing new customers into its fold, which should set the company up for robust long-term growth. A massive addressable market points toward better times for the company Confluent now sees its addressable market exceeding $100 billion this year. That's double its estimated addressable market four years ago. Even better, the accelerated growth in its customer base suggests that it is well on track to capitalize on this massive opportunity. Confluent's overall customer base jumped by 20% year over year in the first quarter of 2025. That was a major improvement over the 9% year-over-year increase in its customer base in the year-ago period. Importantly, Confluent is gaining more business from its existing customers. This can be judged from the company's dollar-based net retention rate of 117%, a metric that compares its annual recurring revenue (ARR) from customers at the end of a quarter to the ARR from the same customer cohort in the year-ago period. So, an ARR of more than 100% suggests that existing customers are spending more money with Confluent. The higher spending by Confluent's older customers is also driving a solid bump in its margins. The company's non- GAAP operating margin increased by six percentage points year over year in Q1. This explains why the company's non-GAAP earnings increased by 60% from the year-ago period to $0.08 per share. The company has guided for $0.36 per share in earnings for 2025, which points toward a 24% increase from last year. However, don't be surprised to see Confluent doing better than that following the healthy increase in Q1, especially considering the pace at which it is adding new customers and encouraging existing ones to spend more money. Not surprisingly, analysts are forecasting an acceleration in Confluent's bottom-line growth over the next couple of years. Data by YCharts. The stronger growth in Confluent's earnings in 2026 and 2027 points toward better times for the stock over the next three years, as the market could reward this impressive bottom-line jump with healthy gains. As such, buying Confluent right now makes sense from a long-term point of view. The correction in the company's stock price since its IPO has made it a better buy, considering its lucrative end-market opportunity and bright prospects. Should you invest $1,000 in Confluent right now? Before you buy stock in Confluent, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Confluent wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $657,871!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $875,479!* Now, it's worth noting Stock Advisor 's total average return is998% — a market-crushing outperformance compared to174%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of June 9, 2025
Time of India
13-06-2025
- Business
- Time of India
95% of Indian IT leaders say data streaming simplifies AI adoption: Confluent report
- 96% of Indian IT leaders to boost data streaming investments in 2025 - 90% cite DSPs as key to AI innovation, faster product launches, and better customer experience. - 5x ROI, real-time decision-making, and AI scalability driving India's data streaming adoption in 2025. Confluent, Inc ., the data streaming pioneer, today released findings from its fourth annual Data Streaming Report , which surveyed 4,175 IT leaders across 12 countries, including 650 respondents from results reiterate that data streaming platforms (DSPs) are no longer a nice-to-have. For Indian businesses looking to scale AI meaningfully, it's become a core enabler. A majority of IT leaders (95%) see DSPs easing AI adoption by tackling data access, quality, and governance challenges head-on. And that explains why 96% plan to increase investments in DSPs in 2025. 'Whether it's product recommendations, service interactions, or support queries, customers today expect responses that are tailored, impactful, and real-time. And they expect the same from AI. For businesses, meeting these expectations requires infrastructure that can keep up. AI is only as good as the data it's built on. Without continuous, trustworthy, real-time data flowing through the organization, AI can't deliver on its promise. That's where data streaming becomes essential, not just for enabling AI, but for staying competitive in a market driven by speed and precision', said Rubal Sahni, Area Vice President, India and Emerging Market at Confluent. Key Takeaways From the 2025 Data Streaming Report Driving force behind AI breakthroughs: 91% say DSPs will be used more to feed AI systems with real-time, contextual, and trustworthy for business strategy: 94% rank data streaming as an important strategic priority. High-impact investment: 86% report 2-5x return on investment (ROI) for data streaming, compared to 80% in 2024.'Shift left' gains momentum: 81% of IT leaders reduced costs and risks across development and operations by adopting a shift-left approach to data processing and governance. 'The pace of execution in India is striking. Teams are going beyond experimentation and solving real business problems with streaming data. Enterprises aren't treating data streaming as just another tool, it's now a strategic muscle helping them act faster, build better, and stay responsive in a fast-changing market.' added Rubal. Unlocking Deeper Value Indian organizations are experiencing tangible benefits in terms of time-to-market, with 89% of respondents noting that DSPs enable them to deploy innovations faster and more efficiently. This increased speed directly contributes to the quality of their implementations, as 95% are seeing enhanced product and service innovation. Furthermore, the impact of DSPs extends to customer experiences, with 86% of organizations reporting improved customer satisfaction. Looking beyond these direct impacts, the adoption of a "shift left" approach to data processing underscores a fundamental prioritization of safety and governance. This early emphasis on governance and data quality leads to reduced processing costs for analytical workloads, where 90% report significant benefits, and for operational workloads, with 93% experiencing similar substantial gains. By embedding quality and governance at the beginning of the data lifecycle, organizations are ensuring the reliability of their systems and, consequently, achieving a reduction in overall business costs and risks, a benefit reported by 85%. Dive into the Data Download the 2025 Data Streaming Report here . The report was based on a survey designed by Freeform Dynamics and conducted by Radma Research. Responses from 4,175 IT leaders were collected across Australia, Canada, France, Germany, India, Indonesia, Japan, Singapore, Spain, the United Arab Emirates, the United Kingdom, and the United States. Qualifying respondents are familiar with data streaming and work at companies with 500 or more employees.
