Piper Sandler Lowers Bentley Systems (BSY) Target, Sees Services Rebound in 2026

Core Insights - Bentley Systems, Incorporated (NASDAQ:BSY) is recognized as one of the 14 best dividend stocks to invest in under $50 [1] - Piper Sandler has lowered its price target for Bentley Systems from $45 to $42 while maintaining a Neutral rating, citing a forecast of 10.5%-12.5% ARR growth for FY26, with only 40 basis points expected from programmatic acquisitions in 2025 [2] - The services segment, which has faced challenges for nearly eight quarters, is anticipated to recover with a projected revenue growth of 15%-20% in 2026 [2] Financial Performance - During the Q4 2025 earnings call, the company reported that its annual constant currency ARR growth has remained in the low-double-digit range since 2022 [3] - Bentley Systems achieved a free cash flow margin of 35% in 2025, with a truly free cash flow margin of 30% when excluding stock-based compensation [3] - The company has successfully retired its convertible debt due in 2026, reducing the fully diluted share count by approximately 3% and completing its deleveraging process [4] Strategic Initiatives - Bentley Systems is focusing on artificial intelligence as a significant opportunity, integrating AI capabilities into its products and building platforms for users to create AI-driven workflows [5] - ARR grew by 11.5% year over year in Q4, with net revenue retention steady at 109%, supported by strong performance in the Seequent segment and Public Works Utilities [6] - The momentum in growth is attributed to global infrastructure investment and robust performance from Bentley Asset Analytics [6] Company Overview - Bentley Systems develops infrastructure engineering software, providing integrated software solutions across various professional disciplines, infrastructure sectors, geographies, and stages of the infrastructure lifecycle [7]