The Asana (NYSE: ASAN) stock price crashed to the lowest level since June 2021 after the company published its earnings. It also crashed after analysts at JP Morgan downgraded the stock. It is trading at $38, which is about 74% below its all-time high. As a result, the company’s market cap has crashed to about $7 billion.
Asana crash explained
Asana is a leading project management and collaboration tool started by Dustin Moscovitz, a co-founder of Facebook. The company went public in 2020 and its stock surged.
Recently, though, the Asana stock price has cratered and moved to the lowest level since June 2021. As a result, its investors have see billions of dollars worth of value disappear.
Asana published results that beat analysts forecasts on Wednesday. Its revenue of $111 million was better than estimates by $6.77 million. Its loss per share of 25 cents was equally better than what analysts were expecting.
Asana has seen the number of companies using its platform soar. It now has over 2 million paid users. Those spending $50,000 and above in the platform jumped by 125% while those spending $100k and above rose to 340.
Asana’s management expects that its revenue will grow to between $114.5 million and $115 million in the first quarter of his year. The firm expects its revenue to be about $531 million for the full year.
While the company had a strong quarter, its share price crashed hard because of the rising fears of slow growth. It also declined after a bearish statement by JP Morgan. In a note, Mark Murphy said that he was lowering its guidance from $66 to $32 citing the weaker full-year guidance.
He also noted that the company is significantly overvalued compared to its peer companies. He noted:
“The combination of slower top line with degrading margins may prompt increasing questions about pull-forward, the efficiency of spend, and competitive pressures, while investors are pivoting toward some semblance of reasonable near-term multiples.”
Asana stock price forecast
The daily chart shows that the ASAN stock price has been in a strong bearish trend in the past few months. As a result, the shares have moved below the 25-day and 50-day moving averages while the MACD indicator has moved below the neutral level.
Therefore, for now, the stock will likely keep falling as bears target the next key support leve; at about $30. In the long-term, however, a bullish rebound cannot be ruled out.
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