N-able Stock Down 30% in 6 Months: Should You Buy the Dip?

Shares of Burlington, MA-based global software company, N-able NABL, have not had a good time on the bourses of late, declining 29.7% over the past six months. Shares of some other players in the Zacks Technology Services industry, like Bitfarms Limited BITF and AppLovin Corporation APP, have performed much better in the same time frame.

6-Month Price Performance

NABL, which delivers an end-to-end cyber resilience platform, is currently trading near its 52-week low of $5.33, reached earlier in the month. Given the significant pullback in NABL’s shares currently, investors might be tempted to snap up the stock. But is this the right time to buy NABL? Let us find out.

Factors Working in Favor of NABL Stock

N-able is benefiting from the rising demand for cybersecurity and IT management solutions among Managed Service Providers and their small-to-medium enterprise clients. The company is actively integrating AI into its security portfolio to upgrade the product offerings. This development bodes well for N-able.

The company has an excellent history with respect to earnings surprise, having surpassed the Zacks Consensus Estimate for earnings in each of the last four quarters by an average in excess of 31%.

N-able, Inc. Price and EPS Surprise

N-able, Inc. price-eps-surprise | N-able, Inc. Quote

N-able’s shares are cheap, trading at a forward 12-month price-to-sales ratio of 5.44. The figure is lower than the industrial levels and industry peer, AppLovin. Bitfarms’ shares are even cheaper. N-able has a Value Score of B, while AppLovin and Bitfarms have a Value Score of D and F, respectively.

NABL’s P/S F12M Vs. Industry, BITF & APP
 

Headwinds Facing NABL Stock at Present

The stock trades below its 14-day moving average, signaling weakness with respect to momentum and price stability. This lack of technical strength underscores negative market sentiment.

14-Day Moving Average Data of NABL Stock

N-able delivers cloud-based Remote Monitoring and Management (“RMM”) solutions built for managed service providers (MSPs), allowing them to oversee, control and protect IT environments — including servers, workstations and other devices — from a single, centralized interface.

However, the company faces intense competition, especially from larger, well-established infrastructure providers. In addition, the rapid development of AI-powered tools poses a risk of commoditizing N-able’s primary RMM and security solutions.

The revenue growth for the company is still in single digits (management expects full-year 2025 in the $507.7-$508.7 million range, representing about 9% year-over-year growth). This suggests limited stock price upside, at least in the near term.

The decline in dollar-based net dollar retention is a big concern (down to 102% at the end of the third quarter of 2025 from 110% at 2023-end) and implies limited customer base expansion potential.

The Zacks Consensus Estimate for full-year 2025 earnings indicates a 12.4% decrease from 2024’s actual levels, clouding the company’s near-term outlook. The company’s Growth Score of D is also a deterrent. Additionally, ongoing tariff-related economic uncertainty could adversely impact NABL’s future operations and financial performance. Furthermore, N-able does not currently pay dividends and has no plans to initiate them, which makes the stock less attractive to income-oriented investors. 

How to Play NABL Stock?

Agreed that NABL is being well-served by the rising demand for cybersecurity and IT management solutions. Its valuation is also tempting. NABL’s earnings history adds to its appeal.

However, the company is experiencing pressure arising from a shift between on-premise and Software-as-a-Service offerings. NABL’s near-term growth outlook represents a big headwind. The uncertain economic outlook is also a hindrance. Rapid technological changes and increased competition may also hurt the stock, pushing it on the back foot. NABL’s unfavorable price performance adds to its list of challenges.

Given the abovementioned headwinds, we believe that it is not at all advisable to buy the dip in this Zacks Rank #3 (Hold) stock currently. Instead, investors should monitor the company’s developments closely for an appropriate entry point.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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