All rights reserved. The company’s CFO spoke to this issue during the earnings call (via ZDNet): “We price on a per seat basis. And the company is also planning to allow users to create private links that allow users from one organization to send direct messages to someone in another organization. However, they can try to become “sticky” by adding features that address consumer complaints or, as it seems in this case, to create features consumers didn’t know they needed. Many of these customers are feeling the financial impact of the pandemic more quickly than large enterprise customers.
The average 12-month price target of $31.10 does offer 14% upside. In addition to the competition, Slack also faces headwinds from companies that are striving to cut costs as the pandemic eats into their bottom line. quotes delayed at least 15 minutes, all others at least 20 minutes. Slack's stock has now fallen nearly 20% from its reference price of $24 on the day of its Wall Street debut. That impact is direct. Slack stock dropped over 10% the day after the company reported slowing revenue growth in its most recent quarter. Many of the analysts specifically mentioned Microsoft as the reason they were skittish. All content of the Dow Jones branded indices Copyright S&P Dow Jones Indices LLC 2018 and/or its affiliates. Combined with concerns that small companies could slash IT spending, that fear led to WORK sliding.

Financial Market Data powered by FinancialContent Services, Inc. All rights reserved. That’s the good news. What really helped to propel Slack stock was the growing feeling that working from home would become the new normal. An asynchronous video feature will give users the ability to create short-form videos to share at the time of their choosing. But that success raised fears of competition. Although they did become free cash flow (FCF) positive for the last two quarters and expect to be FCF breakeven at the end of the year. In addition, Slack has a heavy presence among smaller companies. In a recent interview to Fast Company, Slack’s chief executive officer and co-founder Stewart Butterfield provided a bullish outlook for the future of remote work.
There's more bad news for Slack: The messaging software company's stock plunged nearly 10% Tuesday after Microsoft announced that its rival Teams product has 20 million users. As companies sent employees out of the office to work from home, tools were needed to ensure those remote workers remained in touch and continued to collaborate. Slack stock gets a Portfolio Grader “B” rating. There will be companies that prefer Microsoft. After hitting an all-time high of $37.50, WORK slid significantly, closing as low as $20.46 in the fall. 1125 N. Charles St, Baltimore, MD 21201. I believe the answers are no, no, and no. But that’s just a hunch. The catalyst for that growth , of course, was the pandemic and associated lockdowns. Most stock quote data provided by BATS.

That works very much in favor of solutions like Slack, that help to keep remote team members looped in. Morningstar: Copyright 2018 Morningstar, Inc. All Rights Reserved. "Engagement is what makes Slack work — you can't transform a workplace if people aren't actually using the product," said Brian Elliott, Slack's vice president and general manager of platform, in a, Still, the Microsoft threat is a big reason why Slack's stock. 1125 N. Charles St, Baltimore, MD 21201. And because of our fair billing policies and the substantial number of smaller customers on monthly plans, it shows up much more quickly than it would for others in our industry.”. Is this the time to scoop up shares for your own portfolio? The consensus rating for WORK is overweight, but the split between buy and hold is a narrow one.

Financial Market Data powered by FinancialContent Services, Inc. All rights reserved. Analysts tracked by The Wall Street Journal who follow Slack Technologies have mixed feelings. Slack Technologies, Inc. operates Slack, a business technology software platform in the United States and internationally. When a $1.57 trillion dollar technology behemoth with the world’s most popular productivity suite has its own integrated tool for supporting remote workers, that’s a problem. Phillip Kim is a Professor of Social Innovation at Babson College. And, the company said the third and fourth quarter may bring more of the same.

We won’t know until employees returning to the office in a meaningful way becomes a viable option. Some staff has moved. Slack is ideal for employees to connect, share files, and otherwise collaborate while working remotely. Chris Markoch is a freelance financial copywriter who has been covering the market for over six years. Several analysts issued bearish reports on Slack after it reported results, adding to the downward pressure on the stock. The bad news is that Microsoft can afford for Teams to operate at a loss a lot longer than Slack can. In an interview, he noted the likelihood that this trend could continue well into the future, saying: “once the light at end of the tunnel becomes more apparent, companies have the opportunity to assess how well this experiment worked for them and many will probably continue some form of remote working.”. "While these users start with simple text-based chat, they quickly move on to richer forms of communication and collaboration.

The largest of Slack’s competitors is Microsoft (NASDAQ:MSFT) Teams.

There’s a market force at play. If you’re an employee, will you want to stop using Slack altogether? And investors must reconcile the fact that Slack is not yet profitable. On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article. It’s about what it allows businesses to do, not where they do it from. Slack … On the plus side, the work-from-home movement that was kicked off by the pandemic is showing signs of becoming a permanent way of life for many employees. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC.

But the software wasn’t created with the idea of work-from-home becoming … Nasdaq All rights reserved.

And that can be a way to get more revenue from existing customers.

There’s Nothing Terribly Unique About Slack Stock, bullish outlook for the future of remote work, 5 Keys to Find Small Stocks With 10X Potential, The Slide in Netflix Stock Is a Great Investment Opportunity, Louis Navellier and the InvestorPlace Research Staff, Trump vs. Biden: Stocks to Buy No Matter Who Wins the White House, 7 Monster Growth Stocks With Double-Digit Upside, 7 Dividend Stocks To Buy For Big Returns In Your Bank Account, Plug Workhorse Stock into Your Trading Portfolio Because It Is Electric, DiamondPeak Stock Is Revving Up Ahead of Its Lordstown Merger, Why Nio Stock Could Head to Over $40 Next. And all of these, perhaps not coincidentally, are making the app a bit more like social media. 1125 N. Charles St, Baltimore, MD 21201. Add in the broader tech sector selloff in early September, and WORK is now back down to May-level pricing. However, I think the narrative of Slack stock being a remote work play is a bit overdone. This is a highly competitive field and there’s really no way for Slack to create a moat. Source: Sundry Photography / Shutterstock.com, Buy Slack Technologies Stock As It Begins Bouncing Back, Louis Navellier and the InvestorPlace Research Staff, has its own integrated tool for supporting remote workers, 5 Keys to Find Small Stocks With 10X Potential, The Slide in Netflix Stock Is a Great Investment Opportunity, Trump vs. Biden: Stocks to Buy No Matter Who Wins the White House, 7 Monster Growth Stocks With Double-Digit Upside, 7 Dividend Stocks To Buy For Big Returns In Your Bank Account, Plug Workhorse Stock into Your Trading Portfolio Because It Is Electric, DiamondPeak Stock Is Revving Up Ahead of Its Lordstown Merger, Why Nio Stock Could Head to Over $40 Next. Butterfield sees this tool as a supplement to traditional video conferencing. Updated 1753 GMT (0153 HKT) November 19, 2019. Slack Technologies (NYSE:WORK) has been an interesting case in 2020. Butterfield may have also been attempting to reassure investors.

Article printed from InvestorPlace Media, https://investorplace.com/2020/09/is-slack-work-stock-a-buy-as-it-begins-to-regain-ground/. And there is little doubt that Microsoft is taking direct aim at Slack. But it’s also the reason that investors have to make sure they are buying Slack stock for the right reasons. quotes delayed at least 15 minutes, all others at least 20 minutes.

Butterfield offered that more than 20% of Slack’s workforce has been on-boarded since the pandemic began. 1125 N. Charles St, Baltimore, MD 21201. Or in 2021 or 2022, for that matter. All rights reserved.

What is the significance of this? Article printed from InvestorPlace Media, https://investorplace.com/2020/10/slack-stock-needs-more-than-remote-work-catalyst/.

For instance, last month Teams customers participated in more than 27 million voice or video meetings and performed over 220 million open, edit, or download actions on files stored in Teams," said Jared Spataro, corporate vice president for Microsoft 365 in a.

There’s a good chance WORK will continue to offer at least modest long-term growth potential, especially for investors who snap up shares now, before it recovers from the early September tech sector selloff. The rise in demand and potential permanency of remote work is good for Slack, but it also brings a big challenge: competition. Copyright © 2020 InvestorPlace Media, LLC.

New York (CNN Business)There's more bad news for Slack: The messaging software company's stock plunged nearly 10% Tuesday after Microsoft announced that its rival Teams product has 20 million users. That factor came into play when the company reported second quarter revenue earlier this month. As businesses had to operate remotely, they had a powerful incentive to use the company’s collaboration software.

But its weakness has created a prime dip-buying opportunity. Because at the end of the day, Slack is about the way people work, not where they work. Another tool is what the company is calling “always-available” audio to promote spontaneous interactions among colleagues. Microsoft, for example, may have a larger installed user base thanks to Windows and Office 365, but not every Windows user is actually embracing Teams. And the reason is because of new tools the company is offering.

Large files now have a way of being shared without having them take up space on internal servers. Although losses are expected to narrow, analysts are not forecasting a profit for Slack next year. Since the post-earnings drop, Slack is on the rise again. Slack’s software for remote teams gained popularity during the pandemic but Slack stock has felt the impact of competition and spending cuts. Nasdaq That’s a benefit that many companies were realizing before work-from-home became a necessity instead of a preference. All rights reserved. Slack (NYSE:WORK) has been considered a pandemic winner. And when our customers downsize, freeze hiring or hire more slowly, net dollar retention is negatively impacted. Slack Stock Soars, Putting Company’s Public Value at $19.5 Billion. 2020 InvestorPlace Media, LLC. 2020 and the pandemic reinvigorated Slack. Slack stock tumbled after the workplace-collaboration-software company released its earnings data. First, it’s clear that Slack is committed to remote work. Although it dropped below $20 during the worst of the March market chaos, WORK quickly recovered and then began climbing.

Until then, Slack stock looks to be priced about right. Given all the variables at play, Slack stock isn’t without risk, but that seems moderate at this point. In short, it solves a storage problem for companies. The stock has plummeted nearly 50% from its peak of $42, which it reached on its first day of trading in late June.