By Josh Beckerman

Shares of Weave Communications declined after Raymond James warned of short-term pressures in 2025 following the company's fourth-quarter results.

The stock closed down about 16%, to $14.26, on Friday and have lost around 10% since the beginning of the year.

Results were above Wall Street estimates and Weave--which provides a customer-experience and payments-software platform for healthcare businesses--said Thursday that the quarter was "excellent," with improvements in gross margin, cash flow and operating income.

Raymond James, which reiterated its "strong buy" rating and raised its price target to $20 from $17, said late Thursday a "lower level of planned pricing initiatives is likely to create a headwind to growth in 2025." It said it remains positive about prospects for multi-year durable growth.

Chief Financial Officer Alan Taylor said in an earnings call that Weave doesn't expect the same magnitude of price changes in 2025 as in 2024.

Raymond James said that the stock "could be under pressure tomorrow (after a strong move since 2Q24) on the outlook that factors lower incremental profitability and a growth ramp expected exiting the year." It also "heard several optimistic updates supporting our positive stance" on topics such as partnerships and AI.

Shares are up about 34% over the past 52 weeks and reached their 52-week high of $17.63 on Tuesday.

Adjusted earnings were 3 cents a share and revenue rose 19%, to $54.2 million. Analysts polled by FactSet expected adjusted earnings of 2 cents a share and revenue of $53.2 million. Weave expects 2025 revenue of $232 million to $237 million, up from $204.3 million in 2024.

Meanwhile, Stifel maintained a "buy" rating and $20 target. It said "Weave closed out the year with solid performance and offered an initial guide in line with its typically conservative framework."

Write to Josh Beckerman at josh.beckerman@wsj.com

(END) Dow Jones Newswires

February 21, 2025 16:35 ET (21:35 GMT)

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