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Domo (DOMO) has been upgraded to a Buy rating and its price target increased from $13 to $21 by TD Cowen analyst Derrick Wood. Wood believes the company's strategic focus on consumption-based pricing and cloud data warehouse collaboration will drive sustainable growth. Domo's revenue growth has declined, but the company is working to reverse this trend. The stock is considered overvalued according to its GF valuation score, but analyst recommendations reflect a moderate buy sentiment.

In a significant move, TD Cowen analyst Derrick Wood has upgraded Domo Inc. (DOMO) to a Buy rating, increasing the price target from $13 to $21. This upgrade reflects Wood's optimism about the company's strategic initiatives, which are expected to drive sustainable growth acceleration.

Domo, a technology company providing a cloud-based platform that connects data, systems, and people within an organization, has shown remarkable momentum. The stock has delivered a 95% return year-to-date and is currently trading at $13.84, well above its 52-week low of $6.01 [1].

Wood believes Domo's focus on consumption-based pricing and collaboration with cloud data warehouses will be key drivers of growth. These strategic initiatives are expected to capitalize on the growing demand for data infrastructure stocks, which currently have limited supply options [2]. Domo's recent partnerships with Snowflake and Burbio, which enhance its cloud integration capabilities and data analytics solutions, are also seen as positive developments [1].

However, Domo's financial health remains a concern. The company's current ratio of 0.51 indicates potential liquidity issues, and its Altman Z-Score of -10.5 places it in the distress zone, suggesting a high risk of bankruptcy within two years [2]. Despite these challenges, Domo's strategic reconfiguration, including AI tools and consumption-based pricing models, offers a compelling case for long-term investors willing to navigate short-term risks [3].

While the stock is considered overvalued according to its GF valuation score, analyst recommendations reflect a moderate buy sentiment, with a target price of $14.5 [2]. Technical indicators also suggest that the stock is approaching oversold territory, which could present a buying opportunity for investors.

In conclusion, Domo's strategic initiatives and operational turnaround potential offer investors a contrarian opportunity. However, the company's financial health and profitability challenges present significant risks. Investors should carefully consider these factors when evaluating Domo's investment potential.

References:
[1] https://www.investing.com/news/analyst-ratings/cowen-upgrades-domo-stock-rating-to-buy-on-growth-acceleration-potential-93CH-4210491
[2] https://www.gurufocus.com/news/3078601/domo-domo-receives-upgrade-and-price-target-boost
[3] https://www.ainvest.com/news/domo-domo-trap-contrarian-opportunity-2025-2508/