Shares of Zuora Inc. ZUO, 4.68% are up 3.4% in premarket trading Monday after Needham analyst Joshua Reilly assumed coverage of the software stock from a colleague and upgraded it to buy, setting a $24 price target. “We believe Zuora will accelerate billings growth thanks to changes to its go-to-market and product strategy,” he wrote.
Zuora saw 28% growth in subscription billings in its fiscal second quarter, up from 21% in the fiscal first quarter, which suggests to Reilly that the company is having success with recent changes it’s enacted. “We believe key changes to the [go-to-market] organization including a partner first strategy and focus on ‘strategic land and expand’ are resonating with customers and leading to improved sales metrics,” Reilly wrote. Zuora shares have gained 19.5% so far this year, as the S&P 500 SPX, 0.50% has risen 16.9%.