Octave Intelligence (OCTV) is undergoing a complex transition following its spin-out, as it integrates multiple legacy Hexagon software businesses into a unified SaaS-focused operating model spanning design, build, operate, and protect workflows, RBC Capital Markets said in a note Friday.

Analysts noted limited investor pushback since Octave's separation from Hexagon, with discussions mainly focused on understanding the business structure, while also highlighting that consensus estimates appear uneven, particularly for 2026 revenue expectations.

RBC said its estimates are in line with guidance, with Q2 reported revenue expected to decline 4% year over year due to the divestiture of the federal services business. The firm expects 2026 organic revenue to grow 3.5% based on a pro forma 2025 organic revenue base of $1.59 billion, compared with management's outlook for 3% to 4% growth.

"While we are optimistic of the long-term growth and margin expansion opportunities of the independent company which operates in attractive design-based markets, we think it will take time to materialize given multiple moving parts," the firm said.

RBC maintained its sector perform rating on the stock with a price target of $21.

Octave Intelligence shares were up 2.3% in Monday trading.

Price: 18.00, Change: +0.40, Percent Change: +2.27