Key Moments
- Mizuho reaffirmed its Outperform rating on Atlassian Corp Plc (NASDAQ:TEAM) and increased its price target from $175 to $215.
- Atlassian implemented cloud list price increases of approximately 7% to 10% for key products effective October 13, alongside a broader move to usage-based pricing.
- Mizuho’s updated valuation is driven by a refreshed DCF model extending through fiscal year 2035, using a 13.9% discount rate and an 8.8% terminal growth rate.
Revised Rating and Target for Atlassian
Mizuho has identified Atlassian Corp Plc (NASDAQ:TEAM) as its preferred idea within the large-cap software universe, lifting its price target on the stock to $215 from $175 while reiterating an Outperform rating.
The broker pointed to Atlassian’s ability to drive higher monetization through recent cloud price adjustments and the rollout of broader usage-based pricing as key factors underpinning its more constructive view on the company’s growth trajectory.
Cloud Price Increases Across Key Products
Atlassian recently introduced new pricing for the cloud versions of Jira Software, Confluence, and Jira Service Management. According to Mizuho, these changes translate into an overall increase in cloud list prices in the high single-digit band of roughly 7% to 10%. This move represents a slight step up from the mid-to-high single-digit increases implemented previously. The revised pricing structure went into effect on October 13.
Stock Performance and Usage-Based Billing Rollout
Atlassian Corp Plc (TEAM) is trading at $179.70, with Mizuho maintaining an Outperform recommendation and a $215 price objective. In early September, Atlassian disclosed that it would significantly broaden usage-based pricing across its entire cloud portfolio. Usage monitoring is already in place, with billing tied to this framework scheduled to commence on December 3.
Feedback from a major channel partner suggested that about 10% of cloud customers could see additional charges once usage-based billing is activated. That proportion is expected to increase substantially through fiscal year 2027 as agentic adoption advances.
The channel partner described the shift to usage-based pricing as potentially Atlassian’s most consequential initiative for fiscal 2027. Mizuho also noted that multiple larger customers have already encountered overage situations under the emerging model.
Growth Outlook and Migration Tailwinds
Mizuho believes the market may be underestimating Atlassian’s long-term growth profile, which the firm sees as supported by sustained pricing power and ongoing Data Center-to-Cloud migrations that could remain significant for the next two to three years.
Valuation Metrics
Atlassian’s valuation is framed by Mizuho using forward enterprise value-to-sales and enterprise value-to-free cash flow multiples covering calendar years 2026 and 2027.
| Metric | 2026 Estimate | 2027 Estimate |
|---|---|---|
| Enterprise value-to-sales | 6.4 times | 5.7 times |
| Enterprise value-to-free cash flow | 21 times | 19.5 times |
Mizuho’s revised $215 target price is primarily derived from an updated discounted cash flow framework. The model incorporates projected cash flows through fiscal year 2035, applying a 13.9% discount rate and an 8.8% terminal growth assumption.
Recent Financial Performance and Peer Target Revision
In its most recent financial disclosure, Atlassian reported fiscal fourth-quarter revenue of $1.77 billion. Cloud revenue growth accelerated to 31% year-over-year, and the results included the company’s first GAAP operating profit in more than two years.
Following that earnings release, BTIG reacted by raising its price target on Atlassian shares to $230.
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