Truist Lowers GitLab (GTLB) PT to $35 Citing AI Strategy Importance, Terminal Value Concerns

GitLab Inc. (NASDAQ:GTLB) is one of the best IPO stocks to buy right now. On February 5, Truist reduced its price target for GitLab to $35 from $42 while keeping a Hold rating as part of a wider analysis of the infrastructure software sector. The firm noted that current market pressure is primarily driven by concerns regarding long-term terminal value rather than immediate fundamentals, highlighting the increasing importance of AI-centered strategies.

According to Truist, companies relying on seat-based revenue models were the sector’s weakest performers in 2025 and have continued to underperform in early 2026. Consequently, the firm views the successful adoption of AI use cases and a transition away from seat-based deployments as vital strategic requirements for these firms.

Earlier on January 12, Morgan Stanley downgraded GitLab Inc. (NASDAQ:GTLB) to Equal Weight from Overweight and lowered its price target to $42 from $55. While the firm believes that concerns regarding competition from AI startups and risks to developer seat growth are exaggerated, it expects that disproving these bearish views will take time. Consequently, the analyst views FY2027 as a transition period likely characterized by a further growth slowdown and identifies near-term tactical risks.

GitLab Inc. (NASDAQ:GTLB), together with its subsidiaries, develops software for the software development lifecycle in the US, Europe, and the Asia Pacific.

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Disclosure: None. This article is originally published at Insider Monkey.