Why Braze Stock Recovered 15% This Week
Key Points
Braze is an AI software provider rebounding alongside the broader sector this week.
The company is growing revenue 30% year-over-year, but is not profitable.
Shares of the stock could be cheap if you think it eventually turns the quarter and generates positive earnings.
Shares of Braze (NASDAQ: BRZE) were up as much as 17.3% this week, according to data from S&P Global Market Intelligence. The marketing software provider that has been promoting its artificial intelligence (AI) services has risen this week, along with the rest of the software sector, which has been beaten down in 2026.
Braze is growing quickly, but shares are still down significantly from when the company went public back in 2021. Does that make the stock a buy today?
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
Strong, AI-driven growth
Braze is a software provider for marketers and has recently been adding a bunch of AI tools for its users. These tools help marketing professionals decide where and when to best spend their budgets for clients, leading to a better return on investment. It also has generative image software and predictive analytics to fully serve these marketers.
Financial growth has been solid thanks to these new services. Revenue grew 30% year-over-year last quarter, and is up 323% cumulatively in the last five years.
Image source: Getty Images.
Is Braze stock a buy?
The strong growth coming from Braze is impressive. However, the company has failed to generate positive net income at any point in the last five years, which is why the stock probably still trades at a price-to-sales ratio (P/S) of just 3.4.
If you think Braze can keep growing sales at this impressive rate and turn the corner to profitability, the software stock is likely a buy right now. It is much cheaper than many AI stocks trading today.
Brett Schafer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Braze. The Motley Fool has a disclosure policy.