Descartes Systems Group (DSGX) is expected to report fiscal Q1 results above Wall Street estimates, driven by sustained "organic growth momentum" and contributions from its Idelic acquisition, RBC Capital Markets said in a report Thursday.

Descartes is scheduled to report Q1 FY 2027 after the market close on June 3.

The brokerage said consensus estimates appear "overly conservative" and forecast fiscal Q1 revenue of $195 million, up 15% year over year and above consensus expectations of $191 million, while GAAP earnings per share are projected at $0.54, "slightly above" consensus of $0.52, the report said.

Organic growth is being supported by "upselling," market share gains, e-commerce demand and increased adoption of customs filing solutions despite a continued mixed trade environment," RBC said.

The firm expects fiscal Q2 guidance to come in slightly above consensus, supported by continued organic growth and the "$28 million Idelic acquisition," even as global trade conditions remain mixed with improving import and truck tonnage trends offset by weaker March air cargo demand linked to the Iran conflict, according to the report.

RBC maintained an outperform rating Descartes Systems Group with a $126 price target, citing what it called "compelling" valuation levels near the bottom of the company's 10-year trading range.

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