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KeyBanc On Box: Competitive Moat Is Widening

KeyBanc reiterated its Overweight rating and $21 price target on Box Inc BOX 4.14% as the company's user conference and analyst day showed faster evolution of the core product and widening competitive advantage.

At the event, Box announced new free enhancements to the platform, focusing on improved user experience. On the paid products front, the company launched Box Relay aimed to provide streamlined workflow functionality.

The brokerage said its developer discussions showed gaining momentum for Box products and impressed at "how quickly the core product is evolving."

"We believe Box's competitive moat is widening as it builds out functionality and grows its developer base," analyst Rob Owens wrote in a note.

On the enterprise front, Owens said the Box Platform is gaining traction due to its increasing content collaboration and auditing capabilities. The analyst expects the Platform offering to increasingly drive large deals over the coming year.

"With management reiterating its plan to reach free cash flow positive within the next two quarters, we believe valuation multiples on the name should continue to improve and view BOX as a favorite idea to own," Owens added.

At time of writing, shares of Box fell 2.35 percent to $13.91.

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

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