11:44 AM EDT, 05/29/2024 (MT Newswires) -- Braze (BRZE) will exceed estimates in fiscal Q1 and raise guidance despite mixed research findings on demand, performance and pipeline momentum as expectations are low, Oppenheimer said in an earnings preview Wednesday.

"Our expectation is that the quarterly beats and guidance raise will be at a lower magnitude this quarter and fundamentals remain unchanged," the firm said.

Braze managed typical fiscal Q1 seasonality in the face of a challenging operating environment including a half-day outage, which was mitigated through the management's transparency, according to the note.

The firm said Braze remains competitive against industry giants such as Salesforce ( CRM ) and Adobe (ADBE), with increasing enterprise marketing IT budgets in 2024.

The company's undervaluation, comparable growth and margin potential versus Tier 1 SaaS firms signal investor opportunity despite buy-side shifting away from the namem, Oppenheimer said.

Braze has potential catalysts for higher multiples in fiscal 2025 including fading of net revenue retention compression, enhanced large customer growth, sales force optimization, achievable estimates and profitability upturn in fiscal Q4.

Braze's fiscal Q1 results are expected on June 6.

Oppenheimer reiterated its outperform rating on Braze's stock and lowered its price target to $60 from $75.

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