MANH Cloud Momentum And Buybacks Will Support Long Term Upside

Analysts have modestly raised their fair value estimate for Manhattan Associates to $195 from about $176 per share, citing expectations for stronger revenue growth and a higher future earnings multiple despite near term softness in remaining performance obligations.

Analyst Commentary

Recent Street research on Manhattan Associates reflects a mixed but increasingly balanced stance, with several firms trimming price targets and highlighting execution risks despite a still constructive long term outlook. The modest adjustments in targets and ratings suggest a reset of expectations following softer remaining performance obligation trends and heightened scrutiny of the companys medium term growth cadence.

While some research notes emphasize the strengths of Manhattan Associates cloud native platform and expanding market opportunity in warehouse and supply chain software, others focus on nearer term headwinds, including services growth visibility and the trajectory of cloud growth beyond managements 20% plus target. This has led to a more cautious tone around valuation, particularly after a strong multiyear share price run.

Against this backdrop, investors are weighing robust secular drivers in supply chain digitization and omnichannel commerce against concerns about whether current earnings multiples fully reflect potential volatility in bookings, services mix, and large deal timing.

Bearish Takeaways

• Bearish analysts have reduced price targets following the latest quarterly update, pointing to slower remaining performance obligation growth and signaling that prior expectations for sustained acceleration may have been too optimistic.
• Some research commentary flags structural changes in the services business as a risk to the medium term growth trajectory, raising the possibility of further estimate resets if implementation revenue proves lumpier than expected.
• The recent downgrade to a more neutral stance underscores concerns that, at current valuation levels, there is limited room for additional multiple expansion if cloud growth or RPO recovery falls short of the high bar embedded in estimates.
• Bearish analysts also highlight downside risk to near term services estimates, noting that any disappointment in upcoming quarters could pressure sentiment and challenge the narrative of a smooth transition to higher margin cloud revenue.

What's in the News

• Pacsun completed a rapid rollout of Manhattan Active POS across more than 300 stores in eight weeks, driving record peak season revenue, a 25% reduction in logistics costs, and higher in store fulfillment of online orders (Key Developments)
• Manhattan Warehouse Management System secured FedRAMP authorization from FEMA, reinforcing Manhattan Associates as the only FedRAMP authorized supply chain commerce provider for U.S. federal agencies and contractors (Key Developments)
• The company repurchased 233,425 shares for $49.95 million in the latest tranche, bringing total buybacks under the long running program to nearly 20% of shares outstanding and $1.29 billion in capital returned (Key Developments)
• Management issued 2025 guidance calling for $1,073 to $1,077 million in revenue, a GAAP operating margin of 25.0% to 25.2%, and GAAP EPS of $3.43 to $3.45 (Key Developments)
• In October 2025, Manhattan Associates increased its remaining share repurchase authorization to $100 million (Key Developments)

Valuation Changes

• The fair value estimate has risen moderately to $195 from about $176 per share, reflecting a more constructive view on long term fundamentals.
• The discount rate has increased slightly to approximately 8.5% from about 7.6%, implying a modestly higher required return and risk profile.
• The revenue growth assumption has risen modestly to roughly 7.0% from about 5.8%, indicating higher expected top line momentum.
• The net profit margin assumption has edged down slightly to roughly 19.7% from about 20.2%, signaling a modestly more conservative earnings flow through outlook.
• The future P/E multiple has risen moderately to about 55.0x from roughly 50.7x, suggesting greater confidence in the durability of growth and earnings quality.