Smartsheet Inc Stock Rating Shift: William Blair Downgrades Outlook to Market Perform After Acquisition Announcement
Smartsheet Inc. (NYSE:) saw a change in its stock rating on Wednesday as William Blair adjusted its outlook from "Outperform" to "Market Perform" following the company's acquisition news. The work management platform has agreed to be acquired by Blackstone (NYSE:) and Vista Equity in an all-cash deal valued at $8.4 billion.
The acquisition price of $56.50 per share represents an 8.5% increase over Monday's closing price and a 41% premium over the volume-weighted average price for the 90 trading days leading up to the acquisition rumors. Smartsheet's valuation at this price is 6.3 times the firm's 2025 revenue estimate and 28.8 times its 2025 free cash flow estimate.
This acquisition aligns with recent industry trends, with similar companies like New Relic and Cvent being acquired at similar revenue multiples. The downgrade in Smartsheet's stock rating reflects the company's new investment profile as it transitions to private ownership.
In conclusion, this acquisition marks a significant shift for Smartsheet as it moves from a public company to a privately held entity. Investors should pay attention to how this change will impact the company's future performance and growth prospects.
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