"Coveo's FQ4 headline results were solid, but the spotlight this quarter was on (1) a re-acceleration in ARR growth to 14% y/y, and (2) a new FY guide that reflects visibility to 20%+ y/y ARR growth by year-end - both key factors that we believe will help alleviate concerns about Coveo's competitive differentiation, boost investor sentiment, and re-rate the stock higher. Given sustaining bookings momentum with elevated enterprise demand for high-ROI AI/genAI solutions, Coveo is keeping the foot on the pedal for growth investments, which will weigh on EBITDA margin expansion but could drive greater upside to the current growth outlook (a trade-off we like). With confirmation of a sustainable and accelerating growth trajectory ahead with growth-skewed rule-of-30 ambitions near-term, we raise our target to $13/share (was $11/share). We see a compelling risk/reward on shares with this pure-play AI story trading at 2x revenues," analyst Suthan Sukumar wrote.

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