Freshworks Inc. (FRSH) looking to reclaim success with recent performance

Freshworks Inc. (NASDAQ: FRSH) stock jumped 0.53% on Tuesday to $15.31 against a previous-day closing price of $15.23. With 1.18 million shares changed hands, the volume of the stock remained lighter than its average volume of 1.35 million shares. During the session, the Software – Application company that operates in wider Technology sector, reached to the highest price of $15.69 whereas the lowest price it dropped to was $15.11. The 52-week range on FRSH shows that it touched its highest point at $23.72 and its lowest point at $10.51 during that stretch. It currently has a 1-year price target of $17.15.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of FRSH was down-trending over the past week, with a drop of -5.49%, but this was up by 4.79% over a month. Three-month performance surged to 15.72% while six-month performance rose 22.38%. The stock lost -26.04% in the past year, while it has gained 4.08% so far this year. A look at the trailing 12-month EPS for FRSH yields -0.90 with Next year EPS estimates of -0.08. For the next quarter, that number is -0.04. This implies an EPS growth rate of -80.70% for this year and 27.30% for next year.

Float and Shares Shorts:

At present, 286.70 million FRSH shares are outstanding with a float of 158.33 million shares on hand for trading. On Oct 13, 2022, short shares totaled 11.98 million, which was 4.19% higher than short shares on Sep 14, 2022. In addition to Mr. Rathna Girish Mathrubootham as the firm’s Co-Founder, CEO & Chairman, Ms. Stacey Epstein serves as its Chief Marketing Officer.

Institutional Ownership:

Through their ownership of 63.02% of FRSH’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 7.31% of FRSH, in contrast to 36.88% held by mutual funds. Shares owned by individuals account for 24.66%. As the largest shareholder in FRSH with 7.75% of the stake, The Vanguard Group, Inc. holds 12,483,295 shares worth 12,483,295. A second-largest stockholder of FRSH, Ward Ferry Management Ltd., holds 11,595,886 shares, controlling over 7.20% of the firm’s shares. Champlain Investment Partners LLC is the third largest shareholder in FRSH, holding 6,272,955 shares or 3.89% stake. With a 2.90% stake in FRSH, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 4,677,671 shares are owned by the mutual fund manager. The Vanguard Small Cap Index Fund, which owns about 2.45% of FRSH stock, is the second-largest Mutual Fund holder. It holds 3,943,725 shares valued at 58.01 million. Advisors Inner Circle II – Champl holds 1.69% of the stake in FRSH, owning 2,720,000 shares worth 40.01 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for FRSH since 16 analysts follow the stock currently. There are 6 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 9 believe that the stock is worth HOLDING, 1 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With FRSH analysts setting a high price target of $25.00 and a low target of $14.00, the average target price over the next 12 months is $17.07. Based on these targets, FRSH could surge 63.29% to reach the target high and fall by -8.56% to reach the target low. Reaching the average price target will result in a growth of 11.5% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. FRSH will report FY 2022 earnings on 02/08/2024. Analysts have provided yearly estimates in a range of -$0.08 being high and -$0.12 being low. For FRSH, this leads to a yearly average estimate of -$0.11. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Freshworks Inc. surprised analysts by $0.04 when it reported -$0.01 EPS against a consensus estimate of -$0.05. The surprise factor in the prior quarter was $0.01. Based on analyst estimates, the high estimate for the next quarter is -$0.03 and the low estimate is -$0.04. The average estimate for the next quarter is thus -$0.04.

Summary of Insider Activity:

Insiders traded FRSH stock several times over the past three months with 47 Buys and 7 Sells. In these transactions, 3,246,710 shares were bought while 68,507 shares were sold. The number of buy transactions has increased to 116 while that of sell transactions has risen to 20 over the past year. The total number of shares bought during that period was 14,391,203 while 3,407,670 shares were sold.

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