TEAM
TEAMAtlassian develops collaboration and productivity software for teams in the prepackaged software sector.
It is a dominant provider known for its popular products like Jira and Confluence, which are widely adopted by development and business teams globally.
Updated: January 14, 2026, 16:00 EST
Investment Opinion: Should I buy TEAM Today?
Based on the provided analysis, here is a comprehensive evaluation of TEAM.
Technical Analysis TEAM is in a pronounced downtrend, trading near its 52-week low after a drawdown exceeding 57%. The stock is deeply oversold, indicating very weak price momentum and negative market sentiment. While its beta suggests it is slightly less volatile than the market, this has not provided meaningful downside protection during the recent sell-off.
Fundamental Analysis Fundamentally, TEAM presents a mixed picture. It maintains strong revenue growth and an impressive gross margin above 81%, supported by a healthy balance sheet with low debt. However, the company is currently unprofitable, with negative operating and net margins due to heavy spending on R&D and sales. This reflects a strategic choice to prioritize growth and market expansion over near-term earnings.
Valuation & Risk Valuation is challenging as traditional metrics are negative; the stock is priced entirely on future growth expectations, making it highly speculative. The primary risks are the prolonged lack of profitability and the potential for continued price volatility, as evidenced by the severe drawdown, despite a seemingly lower beta.
Investment Recommendation
TEAM is a high-risk, high-potential investment suited only for investors with a long-term horizon and high risk tolerance. The company's strong market position and robust balance sheet are positive, but its path to profitability remains uncertain. While the current price may be attractive for a speculative entry, investors should be prepared for significant volatility. Given the combination of weak technicals, lack of current earnings, and speculative valuation, a cautious approach is advised.
*Note: This is not investment advice, for reference only.*
TEAM 12-Month Price Forecast
RockFlow Model Forecast: Three Scenarios for 2026
Based on the provided analysis, here is a 12-month outlook for TEAM:
The primary catalyst for a potential rebound hinges on the company demonstrating tangible progress toward profitability, likely through moderating its high R&D and sales spending while maintaining strong revenue growth. Key risks remain the prolonged lack of earnings, which makes the stock highly sensitive to shifts in investor sentiment toward growth companies, and the potential for continued price volatility despite its recent steep decline. Given the deeply oversold technical conditions and speculative valuation, the outlook is highly uncertain; investors should watch for signs of stabilization, but a significant recovery is contingent on a fundamental improvement in the company's earnings trajectory.
Wall Street Consensus
Most Wall Street analysts are optimistic about TEAM's 12-month outlook, with consensus target around $131.96, indicating expected upside potential.
Bulls vs Bears: TEAM Investment Factors
Overall, TEAM has investment potential but also faces challenges. Here are key factors to weigh before investing.
Bullish
- Strategic Acquisition Completion: Acquisition of DX advances engineering intelligence and Rovo Dev capabilities.
- Strong Q1 2026 Fundamentals: Robust growth with RPO reaching $3.3B and AI product expansion.
- Stock Price Surge: Shares jumped nearly 6% amid upbeat sentiment around acquisitions.
- Market Leadership: Recognized leader in software development and work management tools.
Bearish
- Competitive Anxiety Pressure: Shares fell over 5% due to enterprise market competition concerns.
- Insider Selling Activity: CEO Cannon-Brookes sold 7,665 shares, potentially signaling caution.
- Major Insider Sale: Director Scott sold $1.18 million in stock, raising skepticism.
- Market Skepticism: Temporary doubts persist despite strong fundamental performance.
TEAM Technical Analysis
TEAM has demonstrated significant weakness with substantial declines across multiple timeframes. The stock has experienced a dramatic 57.3% drawdown from its 52-week high, reflecting severe underperformance.
Recent performance shows steep declines, with TEAM falling 15.54% over one month and 6.67% over three months while underperforming the market by 10.04%. The stock's beta of 0.888 indicates slightly less volatility than the broader market, though it hasn't provided downside protection against the recent selloff.
Currently trading at $137.89, TEAM is hovering just above its 52-week low of $137.66, representing a decline of approximately 57.7% from its 52-week high. This proximity to the yearly low indicates the stock is deeply oversold, suggesting extremely weak momentum and negative investor sentiment.
| Period | TEAM Return | S&P 500 |
|---|---|---|
| 1m | -18.6% | +1.3% |
| 3m | -8.7% | +5.7% |
| 6m | -40.3% | +10.6% |
| 1y | -47.2% | +16.5% |
| ytd | -14.7% | +1.1% |
TEAM Fundamental Analysis
Revenue & Profitability TEAM's Q1 2026 revenue grew 3.5% sequentially to $1.43 billion, maintaining a strong gross margin above 81%, indicating effective cost control on direct expenses. However, the company reported negative operating and net margins (-6.7% and -3.6% respectively), driven by high R&D and SG&A investments that exceeded gross profits. Profitability pressures persist despite top-line growth, reflecting continued heavy spending on innovation and market expansion.
Financial Health TEAM maintains a conservative debt profile with a low debt-to-equity ratio of 0.89 and a solid cash ratio of 0.81, supported by ample liquidity. The negative interest coverage ratio (-11.2) is attributable to operating losses rather than excessive debt burdens, while strong operating cash flow generation provides flexibility for ongoing investments. Overall, the balance sheet remains robust with manageable leverage.
Operational Efficiency The company exhibits weak returns with negative ROE (-3.8%) and ROA (-0.9%), though asset turnover remains steady at 0.25x. High R&D intensity impacts near-term efficiency metrics, while a negative cash conversion cycle (-34 days) indicates efficient working capital management. Operational performance reflects a growth-focused strategy prioritizing market share over current profitability.
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Level: TEAM's valuation metrics reflect a company in a growth investment phase rather than operational profitability. The negative PE and EV/EBITDA ratios, coupled with a high PB of 27.94, signify that the market is valuing the company based on future growth potential rather than current earnings. While the PS ratio of 7.06 is elevated, it is more justifiable for a software company, but the negative PEG ratio indicates the market's growth expectations are not supported by positive earnings momentum.
Peer Comparison: Without specific industry average data, a direct quantitative comparison is not possible. However, the extremely high negative valuation multiples are uncommon, even for high-growth software peers, suggesting TEAM's financial profile is an outlier. The valuation is primarily supported by narrative-driven growth prospects rather than conventional financial metrics, making it highly speculative relative to typical industry standards.
Investment Risk Disclosure
Volatility Risk
TEAM exhibits moderate volatility risk with a beta of 0.888, indicating its price movements are slightly less pronounced than the broader market. However, the stock has demonstrated significant downside risk, as evidenced by a substantial 1-year maximum drawdown of -57.3%, which severely underperforms typical market corrections. This drawdown highlights the potential for steep, rapid losses during adverse conditions despite its lower beta.
Other Risks
While the absence of notable short interest suggests a lack of strong bearish sentiment from sophisticated investors, this does not eliminate fundamental risks. The extreme drawdown may reflect concerns over growth sustainability, competitive pressures, or profitability challenges inherent to the SaaS sector. Furthermore, investors should monitor liquidity and debt levels, as constrained cash flows could exacerbate volatility during market stress.
FAQs
Based on the analysis provided, I would recommend a neutral to cautious stance on TEAM at this time.
Core reasons: While the company maintains strong revenue growth and a healthy balance sheet, the stock is technically weak—trading near 52-week lows with substantial declines—and its persistent lack of profitability (negative margins) raises sustainability concerns amid heavy spending. Positive analyst sentiment is offset by insider selling and competitive pressures.
Suitable for: This stock may appeal to highly risk-tolerant, long-term growth investors who believe in the company's strategic vision and can withstand significant near-term volatility. It is less suitable for conservative or income-focused investors.
Based on the provided data, TEAM stock is overvalued.
The valuation is exceptionally high by conventional metrics, with a negative P/E ratio of -197 and a negative forward P/E, indicating a complete lack of current earnings. Key metrics like the Price-to-Book ratio of 27.94 are extremely elevated, meaning the market price is 28 times its equity value. The Price-to-Sales ratio of 7.06 is also high, even for a software company.
The primary reason for this overvaluation is the market's speculative pricing based entirely on future growth potential, as the company is not currently profitable (evidenced by negative net and operating margins). The negative PEG ratio further signals that the high price is not justified by any positive earnings growth momentum. Essentially, the stock is priced for a perfect future execution of its growth narrative, making it highly speculative and overvalued relative to its present financial reality.
Based on the provided information, here are the key risks of holding TEAM stock, ordered by importance:
1. Profitability and Growth Sustainability Risk: The company is experiencing significant pressure on its bottom line with negative operating and net margins, raising concerns about whether its current revenue growth can be sustained without a clear path to profitability. 2. Severe Price Volatility and Momentum Risk: The stock has demonstrated extreme downside risk with a 57%+ drawdown from its high and is trading near its 52-week low, indicating very weak momentum and high investor skepticism despite a moderate beta. 3. Intense Sector Competition and High Operational Spending Risk: As a SaaS company, TEAM faces inherent industry pressures that necessitate continuous heavy investment in R&D and sales (evidenced by high SG&A), which currently erodes profits and challenges operational efficiency. 4. Weak Shareholder Return Risk: The negative Return on Equity (ROE) indicates that the company is not currently generating a positive return on shareholder investments, which could limit investor appetite until profitability improves.
Based on the analysis provided, here is a TEAM stock forecast for 2026:
Our base case target for 2026 is $150-170, with a bull case of $200+, driven by a potential inflection toward profitability through moderated spending on R&D and sales while maintaining revenue growth. The primary assumption is that management can execute on cost discipline without stalling top-line expansion, capitalizing on its strong industry position and cash flow. However, this forecast is highly uncertain as it hinges on a reversal of the current unprofitability trend; failure to achieve this would likely result in continued pressure on the stock price.