Is TEAM a good stock to buy? We came across a bullish thesis on Atlassian Corporation on Capital Blueprint’s Substack by Jin. In this article, we will summarize the bulls’ thesis on TEAM. Atlassian Corporation’s share was trading at $79.26 as of June 29th. TEAM’s forward P/E was 12.03 according to Yahoo Finance.
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Atlassian Corporation (NASDAQ: TEAM) is a leading horizontal SaaS platform serving software development, IT service management (ITSM), and workplace collaboration through products including Jira, Confluence, Jira Service Management, Trello, and its AI platform, Rovo. Following several years of slowing growth, the company’s Q3 FY2026 results marked a clear reacceleration, with revenue rising 31.7% year over year to $1.79 billion, cloud revenue increasing 28.6%, and remaining performance obligations growing 37%, signaling strengthening demand and future revenue visibility.
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Atlassian’s enterprise strategy is gaining traction, with its Service Collection surpassing $1 billion in annual recurring revenue while growing more than 30%, including over 50% enterprise ARR growth, alongside its largest-ever quarter of competitive wins from a major ITSM rival, highlighting increasing market share. AI is emerging as another growth driver, as customers adopting Rovo are expanding ARR at twice the rate of non-users, while Teamwork Collection customers demonstrate higher seat expansion and AI engagement without evidence of AI-driven seat compression, supported by net revenue retention above 120%.
The company also benefits from best-in-class gross margins, a growing cloud transition, and a large ecosystem that creates meaningful switching costs for enterprise customers. The primary concern remains elevated stock-based compensation, which consumed most of the company’s reported free cash flow in FY2025 and limits true owner earnings despite improving operating profitability.
Nevertheless, the investment case remains compelling because continued revenue acceleration, expanding enterprise adoption, and sustained AI monetization, combined with a meaningful reduction in stock-based compensation, could allow free cash flow to translate into substantial per-share earnings growth. With shares trading at only about 2.5–3.0x EV/revenue, successful execution on these catalysts could drive a significant valuation rerating from current levels.
Previously, we covered a bullish thesis on Atlassian Corporation (TEAM) by Deep Value Returns in May 2025, which highlighted its strong free cash flow generation and expected growth reacceleration. TEAM’s stock price has depreciated by approximately 61.87% since our coverage. Jin shares a similar view but emphasizes on accelerating enterprise adoption, AI monetization, and stock-based compensation reduction as future catalysts.
Atlassian Corporation is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 44 hedge fund portfolios held TEAM at the end of the first quarter which was 57 in the previous quarter. While we acknowledge the risk and potential of TEAM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TEAM and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
