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Box's Current Valuation Still Holds Upside For Investors Who Missed Lower Level Entrance

Box's Current Valuation Still Holds Upside For Investors Who Missed Lower Levels|Buy, $17 PT|Canaccord Genuity

Close on the heels of Box Inc BOX 4.61% delivering another quarter of positive earnings surprise, Canaccord Genuity believes the stock still presents an opportunity for upside potential. Therefore, the brokerage advised investors who missed earlier entrances to buy the stock.

The firm maintains its Buy rating with a target price of $17.

The comments come on the back of user conference of 5,000 people. Analysts Richard Davis, David Hynes Jr. and Mark Belcarz expect Box to record organic growth of 20–25 percent with strength from file, sync and share. This would lead the company to generate positive free cash flow.

In a research note to clients, the brokerage said, "While we believe Box represents best-in-class file, sync and share, the company, like every company on the planet, is not number one in every feature comparison. Nevertheless, the improved User Interface, low overhead file access and the introduction of a basic workflow engine are certainly positives."

Another positive factor is Box's ability to connect with Google (Alphabet Inc GOOG 1.23% GOOGL 1.31%), thus strengthening its "reputation as a 'Switzerland' vendor" to every big platform.

Pointing out that Box went cheap at $10, the brokerage would not be surprised if Box crosses the $20-mark level in the next six-month period, if not earlier.

The stock traded up by $0.81, or 5.93 percent, to $14.48 at time of writing.

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DateFirmActionFromTo
Jun 2016JP MorganDowngradesOverweightNeutral
Mar 2016Drexel HamiltonInitiates Coverage onBuy
Mar 2016Morgan StanleyMaintainsEqual-weight

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