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GitLab Inc. (NASDAQ:GTLB) is one of the Best AI Stocks to Buy under $50. On December 16, Keybanc downgraded GTLB from Overweight to Sector Weight, with no changes in price targets.
The firm sees “incremental execution risk” for the stock, reflecting near-term caution despite its longer-term AI potential.
The firm anticipates pricing to act as a headwind throughout 2026, limiting upside. Moreover, the company’s transition to a hybrid model that includes consumption/usage based elements with the Duo Agent Platform may introduce execution risk as well.
Lastly, the continued rise of AI code generation may weigh on developer headcount growth, noted the firm.
“The continued overhang of AI code generation weighing on developer headcount growth for seat-based models likely remains. While we continue to appreciate GitLab’s platform driving consolidation opportunities, we see more balanced risk-reward at current levels.”
Despite these concerns, the analysts appreciate GTLB’s platform owing to its ability to simplify workflows and view the stock as more fairly valued.
Analysts on Wall Street have a consensus “Buy” rating on the stock. The average price target of $52.50 implies a 37.47% upside; however, the Street-high target of $72 implies an upside of 88.53%.
GitLab Inc. (NASDAQ:GTLB) is the company behind GitLab, a comprehensive, AI-powered DevSecOps platform that enables organizations to plan, build, secure, and deploy software in a single application.
While we acknowledge the potential of GTLB as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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Disclosure: None.