Key Takeaways:
- AI Momentum: Rovo AI platform surpassed 5 million monthly active users, driving enterprise adoption and larger deal sizes.
- Price Projection: Based on current execution, TEAM stock could reach $118 by June 2028.
- Potential Gains: This target implies a total return of 40% from the current price of $84.
- Annual Return: Investors could see roughly 15% growth over the next 2.4 years.
Now Live: Discover how much upside your favorite stocks could have using TIKR’s new Valuation Model (It’s free)>>>
Atlassian Corporation (TEAM) delivered a standout second quarter in fiscal 2026, crossing $6 billion in annual run rate revenue and achieving its first $1 billion cloud revenue quarter.
The company raised full-year guidance across all key metrics as enterprises increasingly chose Atlassian to power critical business processes.
CEO Mike Cannon-Brookes highlighted record enterprise sales execution.
- Atlassian nearly doubled its number of deals exceeding $1 million in annual contract value compared to the prior year.
- Major customers such as Cisco, Expedia, Reddit, and Synchrony Financial now rely on Atlassian’s platform for their most critical workflows.
- The Rovo AI platform represents a major catalyst for growth. In less than nine months, over 1,000 customers upgraded to the Teamwork Collection, purchasing more than 1 million seats to access enhanced AI capabilities.
- Companies using AI code generation tools showed measurable increases in Jira usage, creating 5% more tasks, maintaining 5% higher monthly active users, and expanding their seat counts 5% faster than those without these tools.
- Cloud revenue grew 26% year-over-year while remaining performance obligations surged 44% to $3.8 billion, signaling strong future revenue visibility.
- Cloud net retention rate climbed above 120% for the third consecutive quarter, demonstrating successful expansion within the existing customer base.
Despite strong fundamentals and growing AI adoption, Atlassian trades at $84, offering upside for investors who recognize the company’s position as enterprises navigate their AI and future-of-work transformations.
See analysts’ full growth forecasts and estimates for TEAM stock (It’s free) >>>
What the Model Says for Atlassian Stock
We analyzed Atlassian’s transformation into an AI-powered collaboration platform and its expanding enterprise market share.
The company benefits from multiple demand drivers. Enterprises are consolidating onto unified work platforms that integrate project management, documentation, and service workflows.
AI capabilities are accelerating this trend, as companies seek platforms that deliver immediate productivity gains while maintaining security and compliance standards.
Atlassian’s Teamwork Graph contains over 100 billion objects and connections across first and third-party tools, enabling Rovo to deliver context-aware AI experiences.
This data advantage, combined with enterprise-grade security and governance, positions the company to capture demand for AI-driven workflow automation.
The Service Collection business shows strong momentum, growing over 60% year-over-year in enterprise markets and expanding beyond IT into HR, finance, and customer service teams. More than two-thirds of Service Collection customers now use the platform for non-IT workflows.
Using a forecast of 18.8% annual revenue growth and 26.5% operating margins, our model projects the stock will rise to $118 within 2.4 years. This assumes a 15.8x price-to-earnings multiple.
That represents significant compression from Atlassian’s historical P/E averages of 43.7x (one year) and 110x (five years). The lower multiple reflects near-term market volatility and broader pressures in the software sector, despite the company’s strong execution and accelerating growth metrics.
The real value lies in capturing long-term enterprise adoption of AI-powered collaboration tools and expanding beyond traditional software development teams to other business functions.
Our Valuation Assumptions
Estimate a company’s fair value instantly (Free with TIKR) >>>
Our Valuation Assumptions
TIKR’s Valuation Model lets you plug in your own assumptions for a company’s revenue growth, operating margins, and P/E multiple, and calculates the stock’s expected returns.
Here’s what we used for TEAM stock:
1. Revenue Growth: 18.8%
Atlassian’s growth centers on cloud migration and AI platform adoption.
The company delivered 26% cloud revenue growth in Q2, with migrations contributing mid-to-high single-digit growth. Management expects this contribution to continue through the full year.
Enterprise customers are signing larger, multi-year commitments. The 44% growth in remaining performance obligations, accelerating for three consecutive quarters, indicates strong forward momentum.
Companies are standardizing on Atlassian not just for 2026, but committing through 2028 and beyond.
The Teamwork Collection reached 1 million seats in under nine months, demonstrating rapid adoption of the premium AI offering.
Customers cite AI capabilities as a primary driver for both cloud migrations and upgrades to higher-tier packages.
2. Operating margins: 26.5%
Atlassian has maintained healthy margins while investing heavily in AI and enterprise capabilities.
The company delivered improving gross margins even while scaling Rovo to 5 million monthly active users, demonstrating efficient management of AI infrastructure costs.
Management reaffirmed its commitment to achieving 25% non-GAAP operating margins by fiscal 2027, with room for further expansion as cloud revenue scales and the product mix shifts toward higher-margin offerings such as the Teamwork Collection.
3. Exit P/E Multiple: 15.8x
The market currently values Atlassian at 16.6x trailing earnings.
We assume modest compression to 15.8x over our forecast period, reflecting broader software sector headwinds despite strong company-specific fundamentals.
Near-term market uncertainty has pressured software valuations across the board.
However, as Atlassian demonstrates consistent execution on AI monetization and enterprise expansion, the company should command a premium to the broader market given its growth profile and strategic positioning.
Build your own Valuation Model to value any stock (It’s free!) >>>
What Happens If Things Go Better or Worse?
Enterprise software faces evolving competitive dynamics and economic cycles. Here’s how Atlassian stock might perform under different scenarios through June 2030:
- Low Case: If revenue growth moderates to 14.4% and net income margins compress to 20.2%, investors still see a 42% total return (8.3% annually).
- Mid Case: With 16.0% growth and 21.7% margins, we expect a total return of 85% (15.1% annually).
- High Case: If AI adoption accelerates and drives 17.6% revenue growth while Atlassian achieves 22.8% margins, returns could hit 135% total (21.5% annually).
See what analysts think about TEAM stock right now (Free with TIKR) >>>
The range reflects execution on AI platform monetization, successful cloud migrations, and the company’s ability to expand beyond software teams into broader business workflows.
The low case assumes slower enterprise spending and increased competition.
The high case captures accelerated AI adoption and margin expansion as the platform scales.
How Much Upside Does Atlassian Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
