Megaport Ltd (ASX: MP1) shares are having a disappointing session.
At the time of writing, the ASX tech share is down 3% to $11.
Though, shareholders won't be overly upset with this given that Megaport's shares are still up almost 50% over the last 12 months.
Can Megaport's shares keep rising?
According to a note out of Citi from last week, its analysts believe the company's shares have room to rise from current levels.
This led to the broker upgrading Megaport's shares to a buy rating with a $12.50 price target. This implies a potential upside of 13.6% over the next 12 months.
Citi believes that the company is well-positioned to benefit from a number of tailwinds such as the emergence of ChatGPT/generative AI. So much so, it suspects Megaport could smash consensus expectations in FY 2024:
It commented:
While we see potential for the return on investment in go-to-market to take longer, we upgrade to Buy given: i) we see upside risk to FY24e forecasts, with our EBITDA forecast 10% above VA consensus; ii) we see Megaport as a beneficiary of increased cloud-adoption, especially multi-cloud, as Enterprises look to adopt GenAI; and iii) we expect the increased investment and focus on the customer to result in increased share-of-wallet.
Is anyone else bullish?
Macquarie is even more bullish on the company's outlook and sees scope for its shares to rise materially from current levels.
Last month, its analysts upgraded its shares to an outperform rating with an $18 price target. This suggests a potential upside of almost 64% for the investors over the next 12 months.
Finally, Goldman Sachs is also bullish but has a more modest $12 price target on its shares. It commented:
We believe MP1 will benefit from strong structural tailwinds from the adoption of public cloud including multi-cloud usage and the transition towards NaaS technologies.
