08:13 AM EDT, 04/05/2024 (MT Newswires) -- National Bank said Thursday that D2L Inc. ( DTLIF ) released "strong" fiscal fourth-quarter results with key metrics such as organic growth, ARR, and adjusted EBITDA all above the NBF forecasts.

"While the revenue guidance came in slightly below our and the consensus number, we do see the potential for upward revisions as the Company carries momentum into the new fiscal year with a higher win rate and stronger market position," the bank said.

Also, National Bank noted that the move to spin out D2L Wave "also makes strategic sense to us" as it will allow the company to realign its focus to the high-growing and high-margin software business while improving the overall margin profile.

The analysts believe that the company is well-positioned for fiscal year 2025. The analysts are expecting opportunities from steady organic growth and consistent margin expansion throughout the year.

"Looking out, we expect hybrid learning to continue driving organic growth beyond the near term and D2L is set to benefit from that trend as the education space is embracing new technology to replace the legacy ones," the analysts added.

National Bank has maintained its outperform rating with a target of C$12 based on the bank's multi-stage DCF model.

The company's shares rose 3.4% in Canada yesterday.