An under-the-radar software company could yield investors as much as 35% upside, according to Morgan Stanley.
Morgan Stanley began research coverage of Model N with an outperform investment rating and $43 price target.
Model N is down more than 19% so far in 2023 after jumping 35% in 2022.
"We're positive on Model N's leadership position and 85% exposure to secular growth of Life Sciences and emphasize their best-in-class profitability relative to [competitors]," Morgan Stanley equity analyst Craig Hettenbach wrote.
Model N, which went public 10 years ago this month , has "an attractive combination of near-term defensive characteristics and long-term secular growth drivers" thanks to a robust roster of pharmaceutical clients, Morgan Stanley said.