Why Manhattan Associates (MANH) Is the Next Big Bet in AI-Driven Supply Chain Tech

The world of supply chain and logistics is undergoing a seismic shift—and Manhattan Associates (MANH) isn't just keeping up, it's leading the charge. With AI-powered innovations, a Shopify partnership that's rewriting omnichannel rules, and a recent CEO transition that's injecting fresh momentum, this stock is primed to explode. Let me break down why investors should act now before the crowd catches on.

Q1 Outperformance: A Strong Foundation for Growth

Let's start with the numbers. In Q1 2025, Manhattan blew past expectations: non-GAAP EPS hit $1.19, a 15.5% jump from the prior year, while RPO (Remaining Performance Obligations) surged 25% to $1.9 billion. This isn't just about revenue—it's about locking in future cash flow. And remember, this came amid a CEO transition, proving the company's resilience.

The 3-year CAGR of 27% for EPS isn't a typo. This is a company that's consistently out-executing peers. With cloud revenue up 21% to $94.3M, Manhattan is shifting its business model toward high-margin SaaS, which analysts love. Yet the stock isn't priced for this transformation. More on that later.

Agentic AI: The Secret Sauce to Dominance

The real magic here is Manhattan's Agentic AI platform, which includes tools like the Store Manager and Labor Optimizer. These aren't just buzzwords—they're AI agents that automate decision-making in real time. For example, the Labor Optimizer reduces staffing costs by predicting demand spikes before they happen. Meanwhile, Enterprise Promise & Fulfill, launched in 2024, lets retailers promise faster, cheaper shipping by dynamically routing orders to the optimal location.

This isn't incremental innovation—it's a paradigm shift in supply chain efficiency. And it's paying off. Gartner just named Manhattan a Magic Quadrant Leader for Warehouse Management Systems (WMS) for the 16th straight year. That's not luck; it's dominance.

The Shopify Partnership: A Game-Changer for Omnichannel

Now, let's talk about Manhattan's January 2024 partnership with Shopify. This isn't a minor deal—it's a strategic masterstroke. By integrating Manhattan's OMS with Shopify's platform, brands like Nautica, Reebok, and Levi's can fulfill orders from any inventory source in real time. Picture this: a customer buys a jacket online, and the system instantly decides whether to ship it from a warehouse, a store, or even a truck en route.

The result? Lower costs, faster deliveries, and fewer returns—all while avoiding overselling. This isn't just a win for retailers; it's a $100B opportunity for Manhattan to capitalize on Shopify's 10% share of U.S. e-commerce. And with Nautica already reporting margin improvements, this isn't theory—it's working.

CEO Transition: New Leadership, Same Firepower

Critics might worry about the February 2025 CEO transition, but let me tell you: Eric Clark isn't just a placeholder. Coming from NTT Data, where he modernized clients' tech stacks, Clark brings cloud-native expertise and a track record of execution. Under his leadership, Manhattan is accelerating AI adoption and expanding its GenAI-driven solutions, like Manhattan Active Maven, which optimizes supply chains using large language models.

Meanwhile, outgoing CEO Eddie Capel stays on as Executive Vice-Chairman, ensuring continuity. The new board additions—like Danielle Sheer, a data management pro—add layers of expertise to fuel growth. This isn't a risky pivot; it's a strategic evolution.

Undervalued? The Data Says Yes

Despite its strengths, Manhattan trades at a P/E of 45.45, which sounds high—until you compare it to peers like Oracle (ORCL) or SAP, which command similar multiples for far slower growth. And let's not forget the institutional support: While some funds reduced stakes, giants like BNP Paribas boosted holdings by 7,175%, signaling confidence. Even with mixed sentiment, 307 institutions added shares in Q1, a bullish sign.

Analysts agree. The average 12-month price target is $196.50, implying a 6% upside, while GuruFocus sees a 32% premium to current prices. Meanwhile, free cash flow margins of 28% and a $600M war chest give Manhattan the fuel to outbid rivals for talent and tech.

Time to Buy—Before the Surge

Here's the bottom line: Manhattan is at the intersection of AI, cloud migration, and omnichannel retail, all megatrends with decades of runway. With a 25% RPO jump, a Shopify-powered growth engine, and a CEO who gets cloud, this is a once-in-a-decade investment.

The skeptics will cite near-term services revenue dips or macro headwinds—but that's noise. The $185 stock price is a steal when you consider the AI-powered future Manhattan is building. Don't wait for others to figure this out. Buy MANH now—before the next earnings report blows expectations out of the water.

Action Items:1. Buy MANH on dips below $185.2. Set a target of $200 for early profits.3. Hold for the long term—this is a 5-year winner.

This isn't a gamble—it's a bet on the future of logistics. And in the Cramer playbook, that's how you make money.