Bull of the Day: Blackbaud (BLKB)

Amid the immense correction in software stocks, investors scoping out buy-the-dip targets may want to consider Blackbaud BLKB, which currently lands a Zacks Rank #1 (Strong Buy) and is the Bull of the Day.

Trading near a 52-week low of $45 a share, Blackbaud stock looks oversold and due for a sharp rebound largely because the broad software selloff has been driven by AI-disruption fears, not by company-specific deterioration.

Furthermore, investors seeking mission-aligned opportunities may be drawn to Blackbaud, whose ESG (environmental, social, and governance) focused approach and leading software cloud solutions directly support social-impact initiatives.

Company Overview 

Blackbaud offers a full spectrum of cloud-based and on-premise software solutions and related services to organizations of all sizes for fundraising, marketing, advocacy, customer relationship management (CRM), corporate social responsibility (CSR), peer-to-peer fundraising, financial management, payment processing, and analytics.

Why Blackbaud Stock Looks Oversold

1. Its niche is less exposed to AI displacement

Blackbaud serves nonprofits, education institutions, and social-impact organizations, segments where relationships, compliance, donor management, and mission-driven workflows are not easily replaced by generic AI agents. Thus, the market’s broad fear doesn’t map cleanly onto Blackbaud’s business model.

2. Recurring revenue and sticky customers

Blackbaud’s customer base tends to be long-term and mission-critical. These organizations rarely switch platforms quickly, even during tech transitions. That stability is often undervalued during sector-wide selloffs. (Blackbaud is expected to post 4% sales growth in FY26 and FY27, with projections heading toward $1.22 billion)  

3. Fundamentals haven’t deteriorated

Nothing in the recent sector news indicates a Blackbaud-specific problem. The stock is falling because the entire software cohort is being repriced, not because Blackbaud’s earnings, margins, or competitive position have suddenly weakened.

4. Mispricing created by indiscriminate selling

When investors dump software stocks broadly — described by traders as “get me out” behavior — quality names get caught in the downdraft. This kind of capitulation selling often creates oversold conditions for companies with stable fundamentals.

EPS Revisions Are Going Up For BLKB

Making the rebound argument hold merit is that full-year EPS revisions are going up for Blackbaud after the company exceeded its Q4 expectations earlier in the month. In the last 30 days, FY26 and FY27 EPS revisions are up over 4%.

Blackbaud’s annual earnings are now expected to spike 16% this year, with FY27 EPS projected to rise another 11% to $5.76.

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Blackbaud’s Enticing Valuation

When a stock declines due to sector sentiment rather than company performance, it often becomes cheaper relative to its cash flows and growth profile, more attractive to long-term investors who understand its niche, and a potential rebound candidate once panic selling subsides.

Blackbaud fits this pattern: a stable, mission-driven software provider being priced as if it faces the same existential AI risks as generic SaaS (Software as a Service) vendors.

Making the trend or rising EPS revisions more attractive and providing an ideal time to invest in Blackbaud is that BLKB is trading at just 9X forward earnings.

Blackbaud stock offers a distinct discount to the benchmark S&P 500 along with its Zacks Computer-Software Industry average of 22X forward earnings, while trading at an 80% discount to its decade-long median of 45X.

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Bottom Line

When the market sells entire sectors indiscriminately, high-quality niche players like Blackbaud can get dragged down even if their fundamentals don’t match the panic. As the smoke clears, Blackbaud stock is becoming one of the best buy-the-dip targets, especially considering it's an ESG-oriented investment.  

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This article originally published on Zacks Investment Research (zacks.com).

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