At last check, Slack shares traded at $23.09, up 10%.
The San Francisco company went public last June 20 in a direct listing, with a starting reference price of $26. In its first day of trading the stock moved as high as $42. It traded below $20 in November.
The RBC analysts, led by Alex Zukin, in a report lauded Slack for its “leading brand, differentiated technology, and strong tailwinds from a growing workplace-collaboration market.”
Some analysts and investors have shrugged off Slack as just another messaging service amid a sea of competitors. The RBC analysts don’t see it that way.
“While the simplistic take on Slack is that it is ‘just another workplace chat tool,’ ... the vision around becoming the primary system of engagement for all employees inside (and increasingly outside) an organization creates a positive data-feedback loop,” the analysts said.
That loop consists of “more engagement, more data, more insights to drive better results, and significant long-term value,” Zukin and his team wrote.
The messaging market could grow to $86 billion, the analysts estimate. Slack "is the leader in this space from both a brand and feature/functionality perspective,” they said. It "remains in an early growth phase with a defensible competitive position and significant monetization potential.”
All Slack has to do is attract more than 50% of developers, and its revenue can easily double over the next few years, the RBC analysts maintain.