{ "@context": "https://frontierpicks.com/schemas/dossier.v1.json", "ticker": "BRZE", "name": "Braze, Inc.", "url": "https://frontierpicks.com/dossiers/BRZE/", "json_url": "https://frontierpicks.com/dossiers/BRZE.json", "status": "WATCHLIST", "current_conviction": "LOW", "archetype": { "code": "a5", "n": 5 }, "current_thesis": "Salesforce's agreed $47.50-per-share cash takeover of Braze caps the shares just under the offer, so they are more likely to lag the S&P 500 than lead it over three months. The US antitrust review, the stockholder vote or a rival bid decides what happens next.", "invalidation_trigger": "A daily close above $57.17, far over the $47.50 cash offer, which would show a rival bid or a raised price pushing the shares into leading the S&P 500; a published competing proposal or a raised Salesforce offer would also prove this call wrong.", "catalyst_date": "2026-12-08", "portfolio": null, "pick": null, "themes": [ "m-and-a-special-situations" ], "tags": [], "sources": [], "caveats": [], "source_links": [ { "title": "Braze, Inc. - Form 8-K - FY2026", "url": "https://www.sec.gov/Archives/edgar/data/0001676238/000095010326015850/dp254600_ex9902.htm", "date": null }, { "title": "Press Release: Braze to Report Fiscal Third Quarter 2027 Results", "url": "https://www.itiger.com/news/2680708253", "date": null }, { "title": "Braze, Inc. - Form DEFA14A - FY2026", "url": "https://www.sec.gov/Archives/edgar/data/0001676238/000095010326017185/dp256588_defa14a.htm", "date": null }, { "title": "InsideArbitrage", "url": "https://www.insidearbitrage.com/2026/10/salesforce-to-acquire-braze-in-a-5-66-billion-cash-deal/?c=ia&s1=tw", "date": "2026-10-20" }, { "title": "Salesforce to Acquire Braze in a $5.66 Billion Deal", "url": "https://money.usnews.com/investing/news/articles/2026-10-20/salesforce-to-acquire-braze-in-a-5-66-billion-deal", "date": "2026-10-20" }, { "title": "days.to", "url": "https://days.to/salesforce-earnings", "date": null } ], "evidence": [ { "claim": "Braze agreed to be acquired by Salesforce for $47.50 in cash per Class A share; enterprise value is about $5.66 billion and the Braze board approved unanimously.", "source": "Braze Form 8-K and joint press release, 2026-10-20", "as_of": "2026-10-19" }, { "claim": "Salesforce owes Braze a $300 million termination fee in specified cases; Braze owes Salesforce $191.39 million in specified cases, including accepting a superior proposal.", "source": "Braze Form 8-K, Item 1.01, 2026-10-20", "as_of": "2026-10-19" }, { "claim": "Closing requires majority approval of outstanding Class A shares, HSR waiting-period expiry and specified foreign antitrust and investment approvals; closing is expected in fiscal 2028, beginning 2027-02-01.", "source": "Braze Form 8-K and joint press release, 2026-10-20", "as_of": "2026-10-20" }, { "claim": "Braze will report fiscal third-quarter 2027 results after the close on 2026-12-08, has suspended quarterly earnings calls and will no longer provide quarterly or annual guidance.", "source": "Braze press release via Business Wire, 2026-11-03", "as_of": "2026-11-03" }, { "claim": "Q2 fiscal 2027 revenue was $227.2 million, up 26.2% from $180.1 million; third-quarter revenue guidance was $229–$230 million, since withdrawn.", "source": "Braze Q2 FY27 earnings release, 2026-09-08", "as_of": "2026-09-08" }, { "claim": "CTO Jon Hyman sold 295,000 shares at an average $44.81 on 2026-10-15 to 2026-10-20 and 20,000 shares at $45.76 on 2026-10-29 under a Rule 10b5-1 plan.", "source": "SEC Form 4 filings, 2026-10-22 and 2026-11-02", "as_of": "2026-11-02" }, { "claim": "UBS, TD Cowen, Stephens and DA Davidson cut Braze to neutral-equivalent ratings with $47.50 targets; Barclays moved to Equal-Weight with a $48 target.", "source": "Benzinga and Fiscal.ai analyst headlines, 2026-10-21", "as_of": "2026-10-21" }, { "claim": "Braze was named a Leader in the inaugural Gartner Magic Quadrant for Email Marketing Platforms.", "source": "Braze announcement via Fiscal.ai, 2026-11-09", "as_of": "2026-11-09" } ], "view_changes": [], "frame": null, "filed_numbers": { "as_of": "2026-11-13", "sector": "Technology", "financials": { "status": "ok", "reason": null, "close_date": "2026-11-13", "latest_quarter": "2026-07-31", "figures": { "revenue": { "status": "ok", "quarters": [ { "end": "2026-07-31", "filed": "2026-09-09", "restated": null, "value_musd": 227.2, "yoy_pct": 26.2 }, { "end": "2026-04-30", "filed": "2026-05-28", "restated": null, "value_musd": 211, "yoy_pct": 30.2 }, { "end": "2026-01-31", "filed": "2026-03-25", "restated": null, "value_musd": 205.2, "yoy_pct": 27.9 }, { "end": "2025-10-31", "filed": "2025-12-10", "restated": null, "value_musd": 190.8, "yoy_pct": 25.5 }, { "end": "2025-07-31", "filed": "2025-09-05", "restated": null, "value_musd": 180.1, "yoy_pct": 23.8 }, { "end": "2025-04-30", "filed": "2025-06-06", "restated": null, "value_musd": 162.1, "yoy_pct": 19.6 } ] }, "gross_margin": { "status": "ok", "quarters": [ { "end": "2026-07-31", "filed": "2026-09-09", "restated": null, "pct": 66.8 }, { "end": "2026-04-30", "filed": "2026-05-28", "restated": null, "pct": 65.7 }, { "end": "2026-01-31", "filed": "2026-03-25", "restated": null, "pct": 65.5 }, { "end": "2025-10-31", "filed": "2025-12-10", "restated": null, "pct": 67.2 }, { "end": "2025-07-31", "filed": "2025-09-05", "restated": null, "pct": 67.7 }, { "end": "2025-04-30", "filed": "2025-06-06", "restated": null, "pct": 68.6 } ] }, "operating_margin": { "status": "ok", "quarters": [ { "end": "2026-07-31", "filed": "2026-09-09", "restated": null, "pct": -8 }, { "end": "2026-04-30", "filed": "2026-05-28", "restated": null, "pct": -13 }, { "end": "2026-01-31", "filed": "2026-03-25", "restated": null, "pct": -13.8 }, { "end": "2025-10-31", "filed": "2025-12-10", "restated": null, "pct": -19.7 }, { "end": "2025-07-31", "filed": "2025-09-05", "restated": null, "pct": -21.5 }, { "end": "2025-04-30", "filed": "2025-06-06", "restated": null, "pct": -24.8 } ] }, "pretax_income": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": -15.8 }, "net_income": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "four_quarters_end": "2026-07-31", "value_musd": -18.9, "four_quarters_musd": -113 }, "operating_cash_flow": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "first_end": "2025-10-31", "value_musd": 92.7 }, "capital_spending": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "first_end": "2025-10-31", "value_musd": 8 }, "free_cash_flow": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "first_end": "2025-10-31", "value_musd": 84.6 }, "diluted_share_change": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "base_end": "2025-07-31", "pct": 4.2 }, "cash": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": 166.8 }, "debt": { "status": "none reported" }, "net_cash": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": 166.8, "note": "no debt reported" }, "deferred_revenue": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": 346.7, "yoy_pct": 32.3 }, "backlog": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": 1092.5, "yoy_pct": 26.7 }, "receivables": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": 112.5 }, "inventory": { "status": "not reported" }, "equity": { "status": "ok", "end": "2026-07-31", "filed": "2026-09-09", "value_musd": 600.2 }, "market_value": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-09-01", "basis_filed": "2026-09-09", "value_musd": 5297.6 }, "enterprise_value": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-09-01", "basis_filed": "2026-09-09", "value_musd": 5130.8, "note": "no debt reported" }, "ev_sales": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-09-01", "basis_filed": "2026-09-09", "multiple": 6.2, "note": "no debt reported" }, "ev_ebit": { "status": "not meaningful" }, "pe": { "status": "not meaningful" }, "pb": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-09-01", "basis_filed": "2026-09-09", "multiple": 8.8 }, "fcf_yield": { "status": "ok", "close_date": "2026-11-13", "basis_end": "2026-09-01", "basis_filed": "2026-09-09", "pct": 1.6 } } }, "short_interest": { "status": "ok", "settlement": "2026-10-15", "published": "2026-10-26", "short_pct_of_outstanding": 7.41, "days_to_cover": 4.2, "change_pct": 3.8 }, "insiders": { "status": "ok", "as_of": "2026-11-15", "windows": [ { "days": 90, "status": "ok", "from": "2026-08-18", "bought_usd": 0, "sold_usd": 17488763.7, "bought_unpriced": 0, "sold_unpriced": 0 }, { "days": 365, "status": "ok", "from": "2025-11-16", "bought_usd": 0, "sold_usd": 26848252.82, "bought_unpriced": 0, "sold_unpriced": 0 } ] } }, "body_markdown": "## Current Thesis\n\nSalesforce's agreed $47.50-per-share cash takeover caps Braze's shares just under the offer. That makes them more likely to trail the S&P 500 over the next three months than to beat it. The US antitrust review, the stockholder vote or a rival bid decides what happens next.\n\nBraze closed at $46.61 on 2026-11-12, below the $47.50 offer. The shares rose from $45.81 on 2026-11-05 with no deal filing in between, so the gap to the offer is narrowing. Even if the deal closes, the most a holder can receive is $47.50 in cash. Both companies expect closing in fiscal 2028, which begins 2027-02-01, at the very end of the three-month window behind this rating.\n\nThe company has started acting like a business that is being acquired. On 2026-11-03 Braze said it will report third-quarter results after the close on 2026-12-08, will hold no earnings call and will no longer give quarterly or annual guidance. A Braze filing with the SEC addressed to customers says the company stays independent until closing and that the preliminary proxy statement is still to be filed. A web search of news and SEC filings on 2026-11-12 found no Hart-Scott-Rodino (HSR) antitrust update and no competing offer.\n\n## Bull Case\n\n- **The cash offer anchors the price.** Braze's 8-K, filed 2026-10-20, says each Class A share converts into $47.50 in cash at closing. InsideArbitrage put the premium at 58.12% over the last pre-announcement close.\n- **Salesforce pays a large fee if it fails.** Under the 8-K, Salesforce owes Braze $300 million in specified cases, including failure to close by the outside date or a permanent legal block.\n- **Founders and a major holder are committed.** Co-founders Bill Magnuson and Jon Hyman, along with Battery Ventures' Neeraj Agrawal, agreed on 2026-10-19 to vote their shares for the merger, according to the 8-K.\n- **The product is still winning recognition.** Braze was named a Leader in Gartner's first Magic Quadrant for Email Marketing Platforms on 2026-11-09. It received a 100% rating in the 2027 TrustRadius Buyer's Choice Awards on 2026-11-10.\n- **One broker sits above the offer.** Barclays moved Braze to Equal-Weight on 2026-10-21 with a $48 target, per Benzinga. UBS, TD Cowen, Stephens and DA Davidson set $47.50 targets that day.\n\n## Bear Case\n\n- **Upside is capped at $47.50.** Eleven brokers cut Braze to neutral-equivalent ratings between 2026-10-20 and 2026-10-21, per Benzinga and Fiscal.ai. A rival bidder would also have to cover Braze's $191.39 million break fee, under the 8-K.\n- **Closing may come after the rating window.** The companies expect closing in fiscal 2028, which per InsideArbitrage runs to January 2028. The 8-K sets an outside date of 2027-10-19 before extensions.\n- **Several approvals stand in the way.** Closing needs a majority vote of outstanding Class A shares, expiry of the HSR waiting period, and specified foreign antitrust and investment approvals, per the 8-K. MLex coverage on 2026-10-20 noted the two companies are among the largest vendors of customer-messaging tools.\n- **Less information until closing.** Braze withdrew its guidance on 2026-11-03, including the $229–$230 million third-quarter revenue range it gave on 2026-09-08. The 2026-12-08 report will come without a call.\n- **An insider kept selling into the offer.** Chief Technology Officer Jon Hyman sold 295,000 shares at an average $44.81 from 2026-10-15 to 2026-10-20 and 20,000 more at $45.76 on 2026-10-29, under a Rule 10b5-1 plan, per SEC Form 4 filings.\n\n## Setup & Price Structure\n\nBraze closed at $46.61 on 2026-11-12, 0.4% below the 52-week intraday high of $46.81 set the same day. The shares are up 61.1% over three months from the $28.93 close on 2026-08-14. The 52-week closing low is $15.79 on 2026-02-23.\n\nOn adjusted daily closes, the 50-day moving average is $33.65 and the 200-day is $25.57 as of 2026-11-12. Both sit far below the price because they still contain the pre-deal months. They show roughly where a standalone Braze traded if the deal failed.\n\nThe closes climbed steadily from $45.79 on 2026-11-06 to $46.61 on 2026-11-12. That is the market pricing a shrinking gap to the $47.50 cash payment as time passes. A close above $47.50 would mean the market expects a higher price than Salesforce's.\n\n## Catalyst Calendar\n\n- **~2026-11-17 (est.):** HSR premerger notification filings. Starts the 30-day US antitrust waiting period; a second request at its end would signal a long review and push closing further out.\n- **~2026-11-23 (est.):** Preliminary proxy statement filed with the SEC. Braze targets filing within 35 days of signing; the background section shows whether other bidders took part, which bears on the chance of a rival offer.\n- **~2026-12-02 (est.):** Salesforce third-quarter fiscal 2027 results. Third-party calendars estimate this date; Salesforce management may update deal timing or the regulatory path for Braze.\n- **2026-12-08:** Braze fiscal third-quarter 2027 results, released after the close with no call. Shows whether revenue held near the withdrawn $229–$230 million range and whether the business stayed intact during the review.\n- **~2026-12-17 (est.):** Likely end of the first HSR waiting period. Expiry would clear a main US hurdle; a second request would signal a long review and raise the risk of failure.\n- **~2027-02-01 (est.):** Start of the expected closing period (fiscal 2028). Closing pays out the $47.50 cash offer; the date falls at the very end of the three-month horizon of this rating.\n- **2027-10-19:** Merger agreement outside date, before extensions. If the deal has not closed and is not extended, either side may terminate, and the $300 million Salesforce fee may become payable.\n\n## What Would Change Our Mind\n\nA daily close above $57.17, far over the $47.50 cash offer, which would show a rival bid or a raised price pushing the shares into leading the S&P 500; a published competing proposal or a raised Salesforce offer would also prove this call wrong.\n\n## Correlation Notes\n\nWhile the deal stands, Braze's shares follow deal odds and time to closing more than software sentiment. The 2026-11-06 to 2026-11-12 drift came with no deal news. That view fails if Braze falls with software peers on days with no deal news.\n\nThe same link works against the lag call in a falling market. A deal-bound stock near its offer moves little when the index drops, so an S&P 500 decline over the window could leave Braze ahead. If the deal failed, Braze would trade again with customer-engagement peers such as Klaviyo, which Benzinga flagged on 2026-10-20 as a possible next target.\n\nSalesforce's shares matter less because the payment is fixed cash. US News reported Salesforce shares down about 2.7% on 2026-10-20, the day the deal was announced.", "first_seen": "2026-11-10", "last_analyzed": "2026-11-12T22:49:05+00:00", "last_synthesized": "2026-11-12", "date_modified": "2026-11-12", "license": "Content © FrontierPicks. Cite the canonical URL." }