HubSpot (HUBS) dropped more than 24% in Friday premarket trading, opening at $243.74, after the company’s Q1 results raised questions about its ability to hit the growth targets investors were counting on.
The headline numbers were actually solid. Revenue came in at $881 million, up 23% year-over-year and ahead of the $863 million consensus. EPS of $2.72 beat estimates of $2.47 by $0.25. Operating margin hit 17.8%, 100 basis points above expectations.
BofA Double Downgrades $HUBS to Underperform from Buy, Lowers PT to $180 from $300
Analyst comments: "We reinstated coverage of HubSpot in March with a Buy rating, arguing an AI-agent-supported 2H26 growth reacceleration to 20% would warrant a positive re-rating. After last… pic.twitter.com/l6swZk8or2
— Wall St Engine (@wallstengine) May 8, 2026
So what’s the problem? Guidance.
HubSpot’s full-year revenue guidance failed to fully reflect the Q1 beat. Cantor Fitzgerald noted the company only flowed through about two-thirds of the first-quarter outperformance into its FY26 outlook. That leaves the high-teens to roughly 20% constant-currency growth many investors were expecting looking out of reach.
Cantor cut its rating to Neutral from Overweight and slashed its price target from $325 to $200. William Blair moved to Market Perform from Outperform.
Part of the issue was a stumble at the start of Q2. HubSpot spent about a week in April retraining its sales team following updates tied to its Spring Spotlight product launch. That disruption dented early second-quarter momentum.
Management also flagged elongating sales cycles. Cantor analysts described most of the causes as “self-inflicted choices” made with longer-term benefits in mind, but ones that are likely to weigh on growth for the next few quarters.
Morgan Stanley kept its Overweight rating but cut its price target from $405 to $350. Wells Fargo, Needham, Stifel, and Citigroup also trimmed their targets. Needham’s cut was the sharpest, dropping from $700 to $300 while keeping a Buy rating.
Across the board, the consensus remains cautiously positive. Of the 29 analysts tracked by MarketBeat, 23 have a Buy rating, four a Hold, and two a Sell. The average target price sits at $365.96 — well above where the stock is trading.
HubSpot’s one-year high was $682.57. It hit a low of $187.45 over that same period.
For Q2 2026, the company guided EPS of $3.00 to $3.02. Full-year EPS guidance stands at $13.04 to $13.12.
Insider activity has been worth watching. Director Brian Halligan sold 8,500 shares in March at $262.75. Insider Erika Ashley Fisher sold 915 shares on May 4th at $236.66, a transaction tied to tax obligations from equity vesting.
On the institutional side, T. Rowe Price raised its stake by 36.5% in Q4, and AQR Capital Management more than doubled its position, up 117.6%. Institutional investors hold 90.39% of the stock.
HUBS has a market cap of $12.55 billion and a P/E ratio of 280.16.
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