AI-Driven Banking And Cloud Platforms Will Expand Global Reach

nCino’s price target has been raised to $35.18 as stronger-than-expected Q2 results, accelerating subscription growth, strategic expansion initiatives, and increasing confidence in margin improvement outweigh valuation concerns and near-term reacceleration risks.

Analyst Commentary

• Positive Q2 results with subscription revenue and profit exceeding expectations, notably driven by better-than-expected mortgage volumes and strong execution, supporting upward estimate revisions.
• Bullish analysts cite reacceleration initiatives—including expanded EMEA focus, renewed credit union market efforts, and cross-selling (especially mortgage)—plus momentum from new product launches and updated pricing strategy.
• Several firms highlight organic subscription revenue growth acceleration (10–22%), improved FY26 guidance, and a consistent history of “beat and raise,” but note that a more durable double-digit growth trajectory is needed for continued multiple expansion.
• A growing confidence in banking software sector rebound, visibility on margin model improvement, and the potential for applied AI to drive higher win rates, yet risk/reward seen as more balanced after shares' recent appreciation and fuller valuation.
• Some cautious tones remain from neutral or bearish analysts citing valuation concerns, second-half comp dynamics limiting further reacceleration until FY27, and company-specific uncertainties during a transition year.

What's in the News

• Keefe Bruyette raised nCino’s price target to $34.50 (from $33) and maintained an Outperform rating, highlighting a strong quarter with subscription revenue 3% above the high end of guidance, while noting current stock valuation appears full (Periodicals).
• nCino issued Q3 2025 guidance for total revenues of $146–$148 million and subscription revenues of $127.5–$129.5 million; full fiscal 2026 guidance set at total revenues of $585–$589 million and subscription revenues of $513.5–$517.5 million (Key Developments).
• The company repurchased 743,669 shares (0.65%) for $19.99 million during May 1 to July 31, 2025, completing the buyback of 2,572,782 shares (2.22%) for $60.55 million under its April 2025 authorization (Key Developments).
• At the June 2025 AGM, shareholders approved an amendment phasing out the classified board and instituting annual director elections, effective immediately (Key Developments).
• Analysts cite nCino’s consistent performance in exceeding forecasts (“beat-and-raise story”) as supporting higher estimates, though valuation is becoming more challenging at current share prices (Periodicals).

Valuation Changes

Summary of Valuation Changes for nCino

• The Consensus Analyst Price Target has risen from $32.00 to $35.18.
• The Net Profit Margin for nCino has significantly risen from 2.95% to 7.27%.
• The Future P/E for nCino has significantly fallen from 222.06x to 98.83x.