11:45 AM EDT, 04/09/2025 (MT Newswires) -- Freshworks ( FRSH ) meets the criteria for a dislocated stock with limited further downside, durable growth at a reasonable price, and defensible competitive moats, Oppenheimer said in an earnings preview Wednesday.

Oppenheimer described company-specific trends in Q1 as mixed. On the positive side, hiring trends improved and exceeded seasonal averages, which the analysts see as a signal of healthy pipeline momentum. However, broader small and medium-sized business market data showed signs of weakening, potentially indicating a more challenging operating environment.

Artificial intelligence adoption at Freshworks ( FRSH ) is trending positively, according to analysts, with early traction for its AI products like Copilot. Still, they noted that greater monetization and financial impact remain ahead, with customer penetration currently below 3%.

Management is working on expanding adoption through freemium models and updated pricing strategies, according to the note.

Despite recent investor caution, particularly around the long-term outlook for the customer experience business and questions over AI's impact, Oppenheimer believes the stock is well-positioned.

With software investors in a more defensive stance due to market volatility and macro uncertainties, Freshworks' ( FRSH ) valuation and strong balance sheet make it a compelling option.

Oppenheimer has an outperform rating on the stock and lowered its price target to $19 from $24.

Price: 11.95, Change: -0.14, Percent Change: -1.12