Simply mention your company is part of the AI boom, and investors will flock to it.
Look at Yext (YEXT), for example.
At the moment, the stock is up about $3.60, or $37.5% on a massive volume spike to 17.24 million shares, as compared to daily average volume of 1.17 million. Positioning itself as a play on the generative AI story, the company just announced, “Our launches of Content Generation Studio and Yext Chat in beta have been catalysts for more in-depth discussions around Generative AI,” CEO Michael Walrath told analysts on an earnings call, as noted by Barron’s.
Analysts at Roth MKM just upgraded the stock to a buy, with a price target of $12.50.
“We are encouraged by management’s focus on sales execution and profitable growth. Plus, upcoming AI products unlock new TAM [total addressable market], and could help reposition Yext as the de facto AI partner for large enterprises,” they said.
Helping, Yext just raised its guidance for fiscal 2024, now expecting for revenue to be in a range of $404 million to $407 million, and adjusted EPS between 28 cents and 29 cents. It had previously guided for revenue of $402 million-$406 million, and adjusted EPS between 22 cents and 23 cents.
Would we buy after the AI-induced gap higher? No.
In our opinion, we’d wait for the YEXT stock to pull back with a healthy correction first.