RBC slashes target price for GitLab in rare downgrade for software name

GitLab, a mid-cap that runs a software development platform, was among the few names in the software segment to receive a target price downgrade from RBC Capital in an update ahead of scheduled quarterly earnings, reports the Motley Fool. This triggered a selloff in GitLab, with the stock falling almost 5% yesterday.

Yesterday, May 19, RBC Capital analyst Matthew Hedberg slashed his target price for GitLab by 15% to $68 per share, according to Market Screener. The Motley Fool points out that GitLab was one of the few software companies to receive a target price downgrade from RBC, though no reason was specified in the article.

Yesterday, GitLab slid almost 5% to close at $48.95 per share, before dipping less than 1% in premarket trading today, May 20.

In his report on notable software stocks, Hedberg notes that fundamental indicators of many companies that have already released their first-quarter earnings beat Wall Street expectations, as reported by the Motley Fool. Their shares have become a safe haven for investors concerned about the potential impact of U.S. tariffs on a range of other sectors.

Hedberg believes the outperformance of software developers will continue, with some companies even raising their guidance, writes the Motley Fool.

GitLab has yet to release its financial results for the first quarter. The Motley Fool notes that only after it does will the “true story be told.”

According to MarketWatch, GitLab stock has 28 “buy” ratings and three “holds” from Wall Street coverage analysts. Their average target price of $72.74 per share suggests upside of almost 49% versus the last closing price.