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. 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. 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. 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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