Blackbaud (BLKB) Tests Its AI Story On Valuation

Blackbaud (BLKB) has put AI at the center of its story with the launch of Lantern, a fundraising focused language model, along with its Platform for Good operating system and a new BILL partnership.

These product launches arrive after a sharp rebound in Blackbaud’s 90 day share price return of 51.54%, even as the year to date share price return is down 24.66% and the 1 year total shareholder return has declined 28.43%. This suggests that momentum has recently been recovering despite a weaker longer run record.

Contrast Blackbaud’s AI push with a hand picked group of other software players by scanning the 20 high quality undiscovered gems that may still be flying under most investors’ radars.

After a 51.54% rebound in 90 days, Blackbaud is no longer trading like a forgotten turnaround idea. The choice now is between paying up for momentum or waiting for a calmer entry, so the valuation work starts here.

Most Popular Narrative: 12.9% Undervalued

Blackbaud’s most followed narrative points to a fair value of $51.50 against a last close of $44.84, so the story hinges on whether AI products, payments and longer contracts can carry earnings far enough to close that gap.

Ongoing investment in generative and agentic AI, now reflected in broad use of machine learning prospecting in Raiser's Edge NXT and the rollout of high ticket Agents for Good products such as the Fundraising Development Agent and the K-12 Admissions Agent, can add new subscription revenue layers and support higher gross margins.

See why 0 investors see Blackbaud as 13% undervalued.

Result: Fair Value of $51.50 (UNDERVALUED)

Still, Blackbaud’s story can be knocked off course if AI projects consume more cash than expected, or if donation related transaction volumes soften and squeeze earnings.

Find out about the key risks to this Blackbaud narrative.

Next Steps

Mixed messages in the story so far. If you want to move quickly and build your own take on Blackbaud, start with the 4 key rewards and 2 important warning signs.

Looking for more investment ideas beyond Blackbaud?

If Blackbaud has sharpened your focus on quality opportunities, do not stop here. Broadening your watchlist now can help you spot the next standout move.

• Pinpoint robust balance sheets and healthier fundamentals before they attract wider attention with the list of solid balance sheet and fundamentals (25 results).
• Zero in on resilient businesses where market pricing looks conservative using the 27 high quality undervalued stocks.
• Prioritise income potential by scanning for payout heavy candidates in the 8 dividend fortresses.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com