Figma stock received a buy rating Wednesday in its first coverage initiation report after its initial public offering last month. Figma stock surged after its IPO but then tumbled.
Piper Sandler analyst Brent Bracelin started coverage of the design software firm with an overweight rating and a price target of 85.
On the stock market today, Figma stock rose 6.7% to close at 74.04.
The San Francisco-based company went public on July 31 with its IPO priced at $33 a share. It jumped 250% from its listing price to end its first day of trading at 115.50. The next day it spiked to a record high of 142.92. After that, it came back to earth.
In his report, Bracelin said he is positive on Figma stock because of the company's "differentiated platform, attractive business model, and broad-based global reach into 450K+ customers."
Figma competes with media creation software firm Adobe and others.
Figma also is in the early innings of unlocking opportunities from AI technology, Bracelin said.
Growth levers for the company include freemium-to-paid conversions, cross selling new products and global expansion, he said.
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