What’s Behind JPMorgan’s Take on Q2 Holdings, Inc. (QTWO)

Q2 Holdings, Inc. (NYSE:QTWO) is among the undervalued software stocks to buy now. On June 22, Ella Smith from JPMorgan trimmed the price target on Q2 Holdings, Inc. (NYSE:QTWO) to $60, down from $80. The firm has updated its financial models and price targets for the banking technology and digital banking space to December 2027 from December 2026.

With a constructive stance on the group, JPMorgan said “AI-defensibility concerns appear overstated relative to the entrenched workflow, data, and compliance moats these vendors have built.”

The firm appeared extremely optimistic on Q2 Holdings, Inc. (NYSE:QTWO) and Alkami, as they operate in a duopolistic digital banking market with solid retention, long contract durations, and opportunities for free cash flow expansion. The firm has an Overweight rating on QTWO.

Overall, Q2 Holdings, Inc. (NYSE:QTWO) has a Buy rating from the majority of the analysts covering the stock, with the remaining 14% having a neutral view. The company has a forward P/E of 21.01 and upside potential of approximately 43%, making it one of the undervalued software stocks to buy now.

Q2 Holdings, Inc. (NYSE:QTWO) is a Texas-based provider of digital solutions to financial institutions, FinTechs, and alternative finance companies. Founded in 2004, the company offers a digital banking platform, risk and fraud solutions, and a real-time core processing platform, among others.

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