Asana stock rises despite Q4 earnings loss

Yahoo Finance Live anchors Julie Hyman and Ines Ferre discuss the rise in stock for Asana following fourth-quarter earnings.

Video transcript

JULIE HYMAN: Time to check on some movers right now. And let's start with Asana. Those shares are up 15%, after the company reported a narrower-than-expected loss.

But importantly here, its founder and CEO says he's gonna buy up to 30 million shares in the company, which is obviously a big vote of confidence here, as the company did also report that loss that was only $0.15 versus the $0.27 estimated. Revenue came in ahead of estimates here. And the company's forecast is also coming in ahead of estimates.

This is a company that makes workplace software or sort of organizational software, as well. And it's interesting here that he's coming out and making this move. Dustin Moskovitz is the-- is the CEO.

INES FERRÉ: Yeah, and just taking a look at some of the comments from Wall Street. You've got KeyBanc Capital Markets that basically said that CEO share repurchase is one of the most important announcements. And that it is a strong vote of confidence when it comes to buying back-- or buying those shares. And in fact, also taking a look at some of the comments that the CEO had made. He's saying, that given the scale and the opportunity that he sees in front of them, as far as the company is concerned, he thinks that the shares of Asana are undervalued.

But Oppenheimer coming out with some pos-- saying that Asana had some solid results in its last quarter with a price target of $28 a share. And Piper Sandler also has a neutral rating on the stock, but talked about outside exposure to the technology vertical that could make a near-term drag on growth into the second half of the quarter. So [? one and more ?]

JULIE HYMAN: I mean, this company is badly in need of a boost. I think we can say, too.

INES FERRÉ: Yeah, 100%.

JULIE HYMAN: I was just looking back, like so many of its peers in enterprise software, it peaked back in November of 2021. And stocks are down to varying degrees since then. This particular one, down about 87% since that time. So it has really just collapsed since then.

Like many of its peers, as well, it has rebounded this year. It's up about 29%. But nonetheless, it's so fascinating if you look at that longer term chart, how far it still has to go to even come close to attaining the levels where it was.

INES FERRÉ: Yeah, it's not out of the winds-- it's not out of the woods. Analysts are seeing some headwinds in the first half of the year for Asana.

JULIE HYMAN: Yeah, but we're seeing that bump here in this morning's session. And sort of reflecting the enterprise software trajectory that we've seen generally. I mean, what I find so interesting about this group, Ines, is that we have seen the rebound this year. We've had a number of gus-- guests recently coming on talking about rates remaining high, talking about the environment remaining tough for growth. And you have to wonder, how sustainable some of the rebound, some of the bounces, some of the reflexive pops in these stocks are going to be.

INES FERRÉ: Yeah, I mean XLK is up more than 10% year-to-date. You've got communication services that's up. You've got the growth names that are up this year, year-to-date. But you have to wonder about some of these companies-- some of the software companies, as well. I mean, we have seen a rebound with them. And it just also depends on what other companies are spending when it comes to software.

JULIE HYMAN: Right. And of course, we've got the whole like old saw about it being a stock picker's market right now, too. That they're not all going to trade together. But to your point, the XLK and communication services, the two best performing group-- groups this year, there's a little dissonance. There's a little disconnect here between that and then what we're hearing from a lot of macro people. But we'll see what happens.

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