Goldman Sachs initiated or assumed coverage of four customer experience software companies on Wednesday. The bank assigned Buy ratings to Twilio, Braze, and Klaviyo, while rating Zeta Global at Neutral.
Zeta Global Holdings Corp., ZETA
Analyst Callie Valenti said Goldman favors companies that can benefit from AI-driven industry shifts, have a differentiated infrastructure layer, and are early in a new product cycle.
The bank set price targets of $300 for Twilio, $34 for Braze, and $26 for Klaviyo. Zeta Global received a $28 target.
Goldman said AI is already driving market share shifts in customer service, with Twilio as a direct beneficiary. In marketing, the bank said companies with strong technology are taking share from legacy solutions as AI pushes enterprises to rethink consumer experiences.
Braze and Klaviyo were highlighted as particular opportunities. Goldman said both stocks have seen unwarranted underperformance due to AI-driven concerns about application software, and that the market is not pricing in the strength of their infrastructure.
The bank said Braze could reach around 20% operating margins within three years as its unit economics improve. For Klaviyo, Goldman pointed to a cross-sell opportunity in customer service and runway within the Shopify ecosystem.
US stock futures steadied on Wednesday after two straight days of losses. Nasdaq 100 futures rose 0.6% and S&P 500 futures edged up 0.3%. Dow Jones futures traded broadly flat.
The recent pullback has been driven by concerns over high valuations, heavy AI-related spending, and fears of interest rate hikes. Investors have been taking profits in AI-linked stocks.
Micron’s earnings are due after the market close Wednesday. Its shares rose more than 250% this year but fell 13% on Tuesday. Wall Street is watching the results closely for clues on AI chip demand.
AI chipmaker Cerebras posted its first earnings report since going public in May. Shares fell over 10% in premarket after the company forecast profit margins would lag those of rivals including Nvidia.
FedEx reported shrinking operating margins in its after-hours earnings, citing rising transportation costs and the impact of shifting trade policy. The delivery company is seen as a bellwether for the broader economy. Shares slid before the bell.
Uncertainty over US-Iran talks also weighed on sentiment. While President Trump pledged the Strait of Hormuz would stay free of tolls, Iran and Oman have begun discussing a fee system for ships crossing the waterway.
Goldman’s positive stance on Twilio, Braze, and Klaviyo comes as the broader tech sector faces pressure. The bank’s AI-focused thesis contrasts with the current market mood around application software.
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