BILL upgraded at Morgan Stanley on strategy, SMB spending trends

Financial operations platform BILL Holdings (NYSE:BILL) was trading higher after Morgan Stanley upgraded the stock on the management's new strategy, strong execution, and a positive turn in small- and medium-sized businesses' spending trends.

BILL stock was 3.48% higher Thursday pre-market to $90.12.

"Management's new strategy better addresses virtual card product shortcomings, expands payment capabilities, and pushes them into the more monetizable midmarket," said analysts Chris Quintero and Keith Weiss in a research note.

"Improving SMB spending, strong early execution against the strategy, and an undemanding valuation create an attractive entry point," said the note.

Morgan Stanley raised its recommendation on the stock to Overweight from Equal-weight, and increased the price target to $105.00 from $95.00.

"Our new PT of $105 represents ~30% upside and a 3:1 risk/reward skew," said the note.

The rating aligns with the average sell-side analysts and Seeking Alpha authors rating of Buy. The Quant Rating system grades the stock as Strong Buy.