Why Sonos Stock Popped to All-Time Highs
Shares of Sonos (NASDAQ: SONO) rose as much as 10% this morning to all-time highs after getting some positive coverage from Wall Street. Morgan Stanley reiterated its overweight rating on Sonos and increased its price target from $30 to $35, which represents 26% upside from yesterday's close. As of 11:50 a.m., the stock had given back some of those gains and was up 5%.
Analyst Katy Huberty is becoming bullish on the audio technology company's business model, arguing that shares are currently undervalued. Revenue and adjusted EBITDA growth is accelerating, and Sonos is making progress on expanding profitability while cash flow improves. Those factors justify the expansion of Sonos' valuation multiples, in Huberty's view. Morgan Stanley also increased its bull case valuation to $52.
Image source: Sonos.
Source Fool.com
