PagerDuty (NYSE:PD) shares rose on Friday after the cloud computing company reported better-than-expected results and guidance that investment firm Monness, Crespi, Hardt said were "worthy of a relief rally."
Analyst Brian White, who has a neutral rating on PagerDuty (PD) shares, noted that the results and guidance should be well-received by investors, though the enthusiasm could be "fleeting."
"In our view, PagerDuty has a large opportunity in the real-time digital operations market, playing into digital transformation; however, the economy appears to be in a recession, equity markets are in turmoil, and the geopolitical landscape viperous," White wrote in a note to clients.
PagerDuty (PD) shares rose nearly 9% to $26.20 in premarket trading.
The application-software company said it now expects full-year revenue to be between $365M and $370M, compared to a prior outlook of $364M and $369M. Its adjusted loss is expected to be between 10 cents and 12 cents per share, compared to a prior estimate of a loss between 17 and 21 cents per share.
Although billings missed estimates, coming in at $92.5M, White noted the "constructive tone" on the earnings call.
White said PagerDuty (PD) is "executing well and enjoying a favorable competitive environment; however, the company experienced lengthening sales cycles for some larger deals in [second-quarter] and transaction scrutiny increased in Europe."
In addition to reporting strong results, PagerDuty (PD) said it expects trailing 12 months billings growth exiting the third quarter to be at or above 20% over last year.