DA Davidson Slashes Accolade Price Target to $5 on Disappointing Outlook

DA Davidson analysts lowered the price target for Accolade (NASDAQ:ACCD) to $5 from $10 while maintaining a Neutral rating following the company’s reported Q1, which resulted in a nearly 30% stock price drop pre-market today.

The downgrade decision comes in response to Accolade's guidance cut, which has raised concerns about the company's growth visibility and predictability. The 5% reduction in the full-year 2025 guidance reflects management's increased scrutiny of marketing investments. Despite this, the company reiterated its EBITDA outlook for the fiscal year.

The analysts noted that the increased risk premium is justified given the diminished visibility of growth and confidence in scaling. Consequently, the price target has been adjusted to $5, valuing the company at 1x next twelve months (NTM) sales.