Update shared on 23 Jan 2026
Fair value Decreased 1.21%Narrative Update: GitLab
The analyst price target for GitLab has been adjusted modestly lower to reflect a new fair value of about US$51.15, trimmed from roughly US$51.78. This reflects analysts factoring in slower expected revenue growth, a slightly lower future P/E, ongoing concerns around competitive pressure and AI related risks, and recent rating changes across the software group.
Analyst Commentary
Recent research has turned more cautious on GitLab, with several firms lowering ratings and price targets while highlighting a mix of competitive, execution, and growth related questions. Here is how bullish and bearish analysts are framing the story today.
Bullish Takeaways
- Some bullish analysts view concerns around AI startup competition and developer seat growth as overblown, suggesting current valuation already reflects a fair amount of pessimism on long term adoption.
- GitLab is still seen as a meaningful player in DevOps, and bullish analysts expect time and execution to play a key role in disproving the more negative growth scenarios that are now priced into targets such as US$42.
- The broader software group is being framed by some firms as having a potentially favorable setup for 2026, with stable macro and IT spending and lower sector valuations. This could help sentiment toward GitLab if it stabilizes growth and execution.
Bearish Takeaways
- Bearish analysts flag intensifying competition, particularly from Microsoft GitHub on regulatory and AI capabilities, as a risk to GitLab's historical strengths in enterprise, self hosting, and data residency. This can weigh on longer term growth assumptions.
- Several research notes point to decelerating growth as GitLab laps prior pricing actions and operates in a rapidly evolving market. This has led to lower price targets in the US$34 to US$42 range and a more cautious stance on medium term growth durability.
- Execution concerns are front and center, including frequent management changes, uneven go to market performance, and a weaker mix of new logos versus expansions. These issues could delay improvements in sales productivity and pressure near term valuation multiples.
- Some bearish analysts see FY27 as a transition year with potential for below consensus initial guidance. This adds tactical risk for investors focused on short term growth metrics and reinforces more conservative P/E assumptions.
What's in the News
- GitLab launched the GitLab Duo Agent Platform, now generally available across GitLab.com, Self-Managed, and GitLab Dedicated. It includes agentic AI tools such as Agentic Chat, Foundational Agents, Custom Agents, External Agents, and Agentic Flows aimed at automating work across the full software lifecycle.
- Agentic Chat supports context aware assistance in the Web UI and IDEs, multi step reasoning, autonomous actions, code generation, CI/CD pipeline support, security explanations, and documentation across tools such as VS Code, JetBrains IDEs, Cursor, and Windsurf.
- GitLab introduced GitLab Credits as a virtual currency for usage based products. Premium and Ultimate customers receive US$12 and US$24 in monthly credits per user for Duo Agent Platform features, with additional credits available via shared pools or monthly on demand purchases.
- The company issued revenue guidance for the fourth quarter of fiscal 2026 of US$251.0m to US$252.0m and for fiscal year 2026 of US$946m to US$947m.
- GitLab appointed Jessica Ross as chief financial officer, effective January 15, 2026. Ross brings more than 25 years of finance and operational leadership experience across multiple public and private companies.
Valuation Changes
- Fair Value: trimmed slightly from about US$51.78 to about US$51.15 per share.
- Discount Rate: adjusted marginally lower from about 8.43% to about 8.41%.
- Revenue Growth: eased slightly in the model from about 18.15% to about 17.84%.
- Net Profit Margin: raised modestly from about 12.35% to about 12.75%.
- Future P/E: brought down from about 65.09x to about 62.74x, reflecting a slightly lower multiple assumption.
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AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.