Lightspeed (TSE: LSPD)

Lightspeed (TSE: LSPD) continues to trend lower. Shares of this cloud-based commerce-enabling platform provider have crashed over 87% from its 52-week high, wiping out shareholder wealth.

Last year, a short report from Spruce Point Capital Management triggered the selling in LSPD stock. The challenging macro environment, including sky-high inflation, rising interest rates, and geopolitical conflict, led to a sharp sell-off in growth stocks, including Lightspeed.

What’s Next 

While the macro environment remains challenging, the massive sell-off in Lightspeed stock indicates that the stock is oversold, especially as the company continues to deliver strong organic revenue growth.

LSPD’s organic revenue increased by 74% during the last reported quarter.

Moreover, its growing customer base, software adoption, and increasing portion of that GTV (gross transaction volume) being processed through its payments solutions are positives.

Barclays analyst Raimo Lenschow remains upbeat about Lightspeed’s prospects and recommends a Buy on its stock. However, Lenschow reduced his price target by 16% due to macro challenges, and tough year-over-year comparisons.

Bottom Line 

Lightspeed is poised to gain from the ongoing digital shift. Further, its large addressable market, opportunities from the higher payments penetration, growing customer base, and acquisitions bode well for growth.

However, the macro concerns and fear of a recession could curb the upside in LSPD stock in the short term.

Nevertheless, Wall Street is optimistic about Lightspeed stock. Its Strong Buy consensus rating is based on three unanimous Buy recommendations. Moreover, due to the significant decline in its price, Lightspeed’s stock price forecast on TipRanks shows strong upside potential.

The average LSPD price target of C$50.55 implies 146.4% upside potential to current levels.