Atlassian Has Been Crushed-But the Setup Into Earnings Is Shifting

Shares of tech stock Atlassian Corp (NASDAQ: TEAM) are trading right around $130, after starting the year above $160. Considering the S&P 500 index is up more than 1% over that same timeframe, it's been a pretty brutal start to the year for investors.

It will perhaps, unfortunately, not have come as a surprise to them, however, considering the stock is down more than 60% from where it was a year ago and has only just hit fresh multi-year lows. Atlassian was already a serial laggard throughout 2025, but the weakness so far this month means it’s already the worst-performing large-cap stock of 2026 so far. 

On the surface, that kind of move looks like a clear vote of no confidence, and will be enough for many investors to stay clear away. But for the contrarians among us, though, this is actually the kind of setup that’s worth a closer look. As we head into the back end of January, with Atlassian’s next earnings report due in less than two weeks, there are several reasons to think this might actually be a buying opportunity—here are the top three.

Reason #1: Wall Street Sees Upside in Atlassian Stock

One of the clearest signals that sentiment has gotten out of sync with fundamentals is the sell-side stance. Over the past three weeks alone, multiple firms have reiterated Buy or equivalent ratings on Atlassian. Mizuho, which has named the stock one of its favorite picks heading into 2026, recently gave it a fresh Outperform rating and a $225 price target. Citigroup made a similar move with a Buy rating and a $210 target, while Piper Sandler and BTIG Research also struck a bullish tone.

The common thread across these updates is that the market has become overly negative about the impact of AI agents and automation on Atlassian’s growth prospects. While not dismissing them, analysts largely agree that these concerns are being both misinterpreted and exaggerated, with AI likely to enhance Atlassian’s platform rather than disrupt its core value proposition. When you have analysts calling for as much as 75% upside in a tech stock, it’s hard not to buy into the potential, no matter how bad the chart might look. 

Reason #2: Oversold Readings Suggest Atlassian Is Stabilizing

That’s important because, from a technical standpoint, Atlassian’s chart looks ugly—though it is starting to show signs of stabilization. Earlier this month, the stock’s relative strength index (RSI) fell as low as 19, placing it firmly in extremely oversold territory. Since then, RSI has moved back above the sub-30 danger zone and is now trending higher, a classic sign that selling pressure is easing.

This week’s price action supports that view. Atlassian stock has popped roughly 10% over the past three sessions, a notable shift after weeks of relentless selling. The stock is also sitting near long-term support levels, and is roughly in the same zone where the bears gave up selling three years ago. While it might be a little early to call this the start of a full trend reversal, these are the kinds of signals that often mark the transition from selling to consolidation.

Reason #3: Atlassian’s Fundamentals Still Look Solid

Perhaps the most compelling argument against the market’s reaction is that Atlassian’s fundamentals remain intact. The company has continued to regularly top analyst expectations, and its most recent earnings report delivered its highest-ever revenue. That’s not exactly the kind of stat you’d expect from a business in terminal decline.

There are also signs that Atlassian’s own AI-driven initiatives are beginning to gain traction, helping to counter fears that it will be left behind in an increasingly automated software landscape. Meanwhile, its valuation has improved significantly after a year of heavy selling, leaving the stock looking far more attractive than it has at any point in recent memory.

None of this removes risk. Atlassian has been a tough stock to own, and confidence will not return overnight. But with the risk/reward profile looking this good, you have to be thinking the market has already priced in the worst-case scenario. If the company can once again top analyst expectations in two weeks, it might be enough to officially get the recovery rally started.

Where Should You Invest $1,000 Right Now?

Before you make your next trade, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis.

Our team has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and none of the big name stocks were on the list.

They believe these five stocks are the five best companies for investors to buy now...

See The Five Stocks Here

The article "Atlassian Has Been Crushed—But the Setup Into Earnings Is Shifting" first appeared on MarketBeat.