CXM Stock Forecast: CXM Sprinklr Inc Declares Q4 Results, Beats Estimates.

CXM Stock Forecast: CXM Sprinklr Inc Declares Q4 Results, Beats Estimates.
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CXM Stock Forecast: Shares of Sprinklr Inc (NYSE: CXM) are expected to trade between $12.81 and $14.01. The overall recommendation is Neutral

CXM Stock Forecast: Latest Price

Metric
Value
Trend
Share Volume
0.43 M
Lower
Average Share Volume
0.8 M
NA
Forward PE (1 Year)
-30.69

CXM Stock Forecast:Performance Chart

Stock Name
5 day
1 Month
YTD
CXM Stock Performance
1.41%
20.83%
-14.06%

CXM Stock Forecast: Support and Resistance

Source
Support
Resistance
Recommendation
$13.18(S3)
$14.27 (R1)
Buy
$12.40(S3)
$13.76(R1)
Sell

CXM Stock Forecast: Technical Analysis

CXM stock forecast

This is the daily chart of Sprinklr Inc since its debut on NYSE on 23rd June 2021. The stock shot up from $14.6 on debut to $26.54 within a couple of days of listing on NYSE. Thereafter, it has been a dismal journey for stock and it has struggled to cross even $17 since the beginning of this year.

The share price seems to be consolidating in the range of $10-$15 since couple of months and is expecting some trigger to start a fresh upward or downward journey. The Q4 2020-21 results announced on April 6th have given a push to the share price, but it seems that it is not able to sustain the momentum in the bad global scenario around the world due to inflation fears and Russia Ukraine war.

The figure above shows various vertical and horizontal lines as probable supports and resistance going forward. Although, stock has not spent one year on NYSE yet but it is always good to look at chart for supports and resistances if we want to talk about stock forecast in the near term. As stock has formed red candle from past two days, we will first talk about the supports.

The first support is at $12.80, the reason being, $12.80 acted as resistance couple of time in the past, but on 7th April, stock broke that resistance with a strong green candle, and hence it will now act as support and should cushion the downfall of the stock. If share price breaks that level, then $11 should act as next support because stock started the upward journey after forming a low of $11 on 6th April. Thereafter, $9.66, the low formed on 24th January should act very strong support because it was the low formed during consolidation zone and stock does not break that level normally.

Talking about the resistance, the first should be recently formed top of $14.57 on 11th April. The next resistance should the high formed on 23rd December of $16.43. Soon after that, stock started the downtrend and formed a low of $9.79 within one month on 28th January. If the uptrend stays strong and stock breaks the level of $16.43, then $20.35, the high formed on 1st November should act as very strong resistance as stock tried at least thrice to break this level from August 2021 to November 2021, but could not achieve that and hence started a significant downward journey beyond that point.

The support and resistance level based on various methods is tabulated below for reference: –

Name
S3
S2
S1
Pivot
R1
R2
R3
Classic
7.09
9.41
10.66
11.73
12.98
14.05
16.37
Fibonacci
9.41
10.30
10.85
11.73
12.62
13.17
14.05
Woodie’s
8.44
9.47
10.76
11.79
13.08
14.11
15.40

CXM Stock Forecast: Bull Case

Better than expected Q3 and Q4 2020-21 Results: – Sprinklr Inc declared Q3 results on 10th December 2021 and Q4 2020-21 results on 6th April 2021. On both occasions, Sprinklr Inc declared results that beat market estimates in terms of revenue and loss margin. For the period ended Oct 31, the company’s sales rose 32% YoY to $127 million.

However, the adjusted earnings declined from $0.02 profit to a loss of $0.06 per share YoY. However, it was better than expected as analysts were expecting a loss of $0.09 per share and total revenue of only $120 million.

Also, the stock reacted very positively to these results and rose up to 21% post-results. In Q4 2020-21, sales rose 30% to $136 million against the market expectation of $130 million. The adjusted earnings per share came at $ (0.05) against estimates of $(0.09). Again the share price jumped almost 17% on 7th April 2022 in the backdrop of these strong numbers.

Shareholders Pattern – A shareholder’s pattern tells a lot about the company. If a company has good quantum of institutional backing portion as a shareholder, it is a good sign for it. Similarly, if the management has at least 40% of outstanding shares, it also instills confidence among retail investors that company insiders themselves have confidence in the company.

That is the reason that some shares see a huge spike in share price on the news of insiders buying shares of a particular company. For Sprinklr Inc, a similar is the case. It has a market capitalization of around $5 billion. The company’s largest shareholder is Hellman and Friedman LLC with an ownership of 22%. Ragy Thomas who is also CEO of the company holds 21% of the shares. So Sprinklr Inc has got the backing of institutions and management and that is a positive sign for any investor.

CXM Stock Forecast: Bear Case

Loss-making company: – It is great to see that revenue for the company is increasing every quarter, and the share price is reacting to that positively but revenue is only one dimension of the balance sheet and quarter/annual results. But net income is also an equally important aspect. Sadly, for Sprinklr Inc, it has never reported a profit on its balance sheet. Also, the net losses are increasing in every annual/ quarter result.

The net income has increased from negative $ 39 million in 2019 to negative $ 114.09 million TTM. Increased revenue should result in net income for a healthy company. Also, the EPS has increased from negative 0.16 in 2019 to negative 0.45 TTM. An increasing net income is a must before making an investment decision.

CXM Stock Forecast: Buy, Sell or Hold

Sprinklr Inc started off its journey in 2009 to help manage companies manage their social presence. In the last decade, it has expanded its horizon to integrate more than 30 different channels to better customer experience, marketing and other content.

The revenue is increasing every quarter and the share price has surged nearly 20% in the past two quarters, but things have been worsening on the net income front. The stock is likely to remain volatile for the time being and it will see major upswings and downswings on the date of quarter results but it is not meant for long-term holding as it is still a loss-making company. CXM stock is only meant to take some quick profits in momentum trading.

Read our US Stock Predictions here

CXM stock forecast

-Vineet Agarwal

Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in Stocks or Coins. Please consult a registered investment advisor to guide you on your financial decisions. 

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