Shares of Slack (WORK) - Get Report on Tuesday surged on after a vote of confidence by a top industry analyst, who sees covid-19 providing a "major booster shot" to the cloud-based work-messaging platform.
Slack's stock at last check jumped 5.8% to $39.35 as Cowen analyst J. Derrick Wood launched coverage of the San Francisco company with an outperform rating.
Wood also set a $45-a-share price target on Slack, which indicates a nearly 16% premium over its current trading price.
The Cowen analyst contends the shift to working at home amid the coronavirus crisis has provided a major lift to Slack, with the platform already popular before the crisis among organizations using remote workers and freelancers.
The new work-from-home routine of tens of millions of workers across the country has dramatically expanded the market for Slack's work-messaging platform, the Cowen analyst noted, according to TheFly.
Before the crisis, just 7% of the 140-million-strong civilian workforce in the United States had teleworking arrangements, according to the federal Bureau of Labor Statistics.
The remote work platform company is also on track to unveil strong quarterly numbers on Thursday, which should help reset expectations among analysts in regards to the performance of Slack's stock price, Wood wrote,
The results, in particular, should help highlight Slack's growth potential in the post-pandemic world.
And a strong showing by Slack in its first-quarter numbers should dispel longstanding investor anxiety about competition from Microsoft (MSFT) - Get Report in the work-collaboration platform space, concern that has been a drag on Slack's stock price, Cowen's Wood noted.
For Slack's fiscal first quarter ended April 30, the consensus estimate in a survey of analysts by FactSet is a net loss of 17 cents a share, or an adjusted 6 cents, on revenue of $188.5 million.
Microsoft shares at last check were 0.8% higher at $184.30.