Last Update 07 Feb 26

Fair value Decreased 6.32%

MNDY: Upmarket And AI Adoption Will Support Long Term Revenue Mix Shift

Analysts have trimmed their fair value estimate for monday.com from about $305.14 to $285.87, citing a mix of slightly lower revenue growth and profit margin assumptions, along with a higher future P/E expectation despite a marginally lower discount rate.

Analyst Commentary

Recent Street research on monday.com shows a cluster of reduced price targets, yet many firms are still expressing confidence in the business model, execution with larger customers, and the long term revenue roadmap. For you as an investor, the key question is whether these lower targets reflect a reset in expectations or a deeper shift in the thesis.

Several research notes highlight slower booking trends tied to longer sales cycles, softer small business demand, and what they describe as mixed quarterly results. At the same time, multiple firms maintain positive ratings and point to upmarket traction, multi product adoption, and management's longer term revenue ambitions as key supports for their outlook on the shares.

Bullish Takeaways

Bullish analysts who cut targets, for example in the US$200 to US$300 range, frequently kept positive ratings on the stock, which signals they still see upside potential even after resetting their fair value assumptions.
Several reports highlight monday.com's move upmarket, including larger customer wins and multi product adoption, as a core execution driver that they expect to be increasingly important for revenue durability and margin potential.
Some bullish analysts explicitly reference growth in RPO bookings and improvements in metrics like $50,000+ net dollar retention and net new customer additions as supportive of the medium term path to management's US$1.8b revenue objective.
Even where near term guidance was described as cautious or below prior expectations, bullish research notes emphasize that AI uptake and the broadening product suite could help support longer term growth, which in turn underpins their higher price targets relative to the current market price.

What’s in the News

monday.com issued fourth quarter 2025 revenue guidance of US$328 million to US$330 million, with the company stating this would represent year over year growth of 22% to 23% if achieved. (Company guidance)
For full year 2025, monday.com guided to total revenue of US$1.226b to US$1.228b, which it described as approximately 26% year over year growth. (Company guidance)
monday.com was announced as Official Global Work Management Partner of the Bonds Flying Roos, the Australian SailGP team, in a multi year deal intended to support operations across training, logistics, equipment, content and race execution. (Client announcement)
The Bonds Flying Roos, co owned by Hugh Jackman and Ryan Reynolds, will debut monday.com branding at the Mubadala Abu Dhabi Sail Grand Prix 2025 Season Grand Final, where the team is competing for a potential fourth championship and a US$2 million prize purse. (Client announcement)

Valuation Changes

Fair Value Estimate was reduced from about US$305.14 to US$285.87, reflecting a modest trim to the analyst model.
The Discount Rate was adjusted slightly lower from 10.69% to about 10.49%, implying a marginally lower required return in the updated assumptions.
Revenue Growth eased from about 23.09% to roughly 22.52%, pointing to slightly more cautious top line expectations.
The Profit Margin was reduced from about 11.65% to around 9.85%, indicating a more conservative view on future profitability.
Future P/E was raised from about 88.19x to roughly 98.56x, suggesting a higher valuation multiple applied to earnings in the revised model.

Surging enterprise demand, transformative AI-driven workflows, and platform modularity position monday.com for outsized recurring revenue and industry-leading stickiness beyond current expectations.
Operating leverage and moderating spending are enabling faster margin expansion and free cash flow growth as long-term growth compounds.
Mounting AI-driven acquisition challenges, market saturation, intensifying competition, and rising innovation costs threaten to strain growth, profitability, and international expansion opportunities.

Catalysts

About monday.com

Develops software applications in the United States, Europe, the Middle East, Africa, the United Kingdom, and internationally.What are the underlying business or industry changes driving this perspective?

Analyst consensus believes enterprise growth will be strong and support revenue expansion, but recent record-breaking additions of $100,000+ ARR customers and an all-time high in gross retention suggest a much steeper acceleration is possible, with outsized gains in both revenue and net dollar retention far beyond current forecasts.
Analysts broadly expect monday.com's AI and product innovation to modestly boost contract values and user engagement, but transformative tools like vibe coding, monday magic, and sidekick are creating a new system-of-action paradigm that is converting workflow management into automated execution, positioning monday.com to become a mission-critical operating platform and unlock a new tier of high-margin, recurring AI-driven revenue.
The rapid, cross-vertical digitization of workflows and the ongoing normalization of remote and hybrid work globally are likely to drive an unprecedented volume of both new customers and seat expansion, compounding monday.com's long-term recurring revenue and creating significant runway for sustained growth.
The structure and modularity of monday.com's platform, combined with the explosive adoption of no-code/low-code and workflow integration tools, gives the company a structural advantage as organizations converge onto unified work management hubs, enabling faster customer acquisition, higher ARPU, and industry-leading stickiness, supporting sustainably higher net margins.
With expanding operating leverage-evidenced by rising non-GAAP operating income and headcount investments already moderating into next year-monday.com is poised to see compound benefits to earnings as earlier investments yield results, allowing margins and free cash flow to scale faster than forecast as revenue accelerates.

monday.com Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

This narrative explores a more optimistic perspective on monday.com compared to the consensus, based on a Fair Value that aligns with the bullish cohort of analysts.
The bullish analysts are assuming monday.com's revenue will grow by 24.5% annually over the next 3 years.
The bullish analysts assume that profit margins will increase from 3.6% today to 10.5% in 3 years time.
The bullish analysts expect earnings to reach $223.4 million (and earnings per share of $3.57) by about September 2028, up from $40.0 million today. The analysts are largely in agreement about this estimate.
In order for the above numbers to justify the price target of the more bullish analyst cohort, the company would need to trade at a PE ratio of 130.6x on those 2028 earnings, down from 249.7x today. This future PE is greater than the current PE for the US Software industry at 36.2x.
Analysts expect the number of shares outstanding to grow by 2.83% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 10.68%, as per the Simply Wall St company report.

monday.com Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

The growing influence of Google search engine algorithm changes-driven by AI-generated results-has already hurt monday.com's ability to acquire new small and medium-sized customers, contributing to a weaker net new accounts number and a softer outlook in the lower segments, which could place long-term pressure on revenue growth if the trend continues or worsens.
Increasing commoditization of project management and productivity software creates persistent pricing pressure and increases customer switching rates, threatening to suppress monday.com's net revenue retention and compress gross and operating margins over the long run.
The company's heavy investment in AI capabilities and R&D, while currently helping to drive innovation, risks requiring ever-higher ongoing expenditure as the industry accelerates its adoption of advanced automation, potentially straining future net margins and free cash flow as the cost of innovation rises to remain competitive.
Slower expansion beyond core North American and Western European markets-due to localization and brand recognition limitations-may curtail international revenue growth and limit the company's long-term total addressable market, constraining overall revenue expansion opportunities.
Intensifying competition from both established SaaS giants and nimble new entrants, especially as more vendors move toward open and interoperable platforms, could erode the uniqueness of monday.com's all-in-one suite, forcing higher customer acquisition and retention costs that threaten to depress earnings and net margins over time.

Valuation

How have all the factors above been brought together to estimate a fair value?

The assumed bullish price target for monday.com is $384.25, which represents two standard deviations above the consensus price target of $282.46. This valuation is based on what can be assumed as the expectations of monday.com's future earnings growth, profit margins and other risk factors from analysts on the bullish end of the spectrum.
However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $450.0, and the most bearish reporting a price target of just $205.0.
In order for you to agree with the bullish analysts, you'd need to believe that by 2028, revenues will be $2.1 billion, earnings will come to $223.4 million, and it would be trading on a PE ratio of 130.6x, assuming you use a discount rate of 10.7%.
Given the current share price of $193.63, the bullish analyst price target of $384.25 is 49.6% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystHighTarget 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 AnalystHighTarget 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 AnalystHighTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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