ZoomInfo Shares Jump 24.4% After Fourth-Quarter Results Beat Revenue Expectations
Shares of sales intelligence platform ZoomInfo experienced a significant boost in after-market trading, surging by 24.4%, following the release of its fourth-quarter financial results. The company’s revenue narrowly exceeded analysts’ expectations, while its non-GAAP operating profit also surpassed forecasts. Additionally, ZoomInfo generated robust free cash flows. Although the revenue guidance for the upcoming year suggests a potential slowdown in growth, it was generally in line with expectations. These positive results indicate that ZoomInfo is performing better than anticipated, particularly considering the challenges the company has faced over the past year and concerns surrounding the impact of AI on its business.
ZoomInfo’s shares have displayed substantial volatility, with 24 movements greater than 5% occurring within the last year. Despite this, such significant fluctuations are uncommon for the company and indicate a substantial impact on the market’s perception of its business. Just 15 days ago, ZoomInfo experienced a notable increase of 6.9% when Bank of America analyst Koji Ikeda upgraded the company’s stock rating from Neutral to Buy, raising the price target from $20 to $25. This new target suggests a potential upside of 45% compared to the stock’s trading price at the time of the upgrade. Ikeda highlighted that ZoomInfo’s valuation traded at a 50% discount to its software peers, providing potential for multiple expansion. He acknowledged that the stock’s controversial nature warrants an understanding of the associated risks. Since the beginning of this year, ZoomInfo shares have risen by 2.1%. However, at $18.15 per share, they are still trading at a 37.3% discount from the 52-week high of $28.95 reached in July 2023. Investors who invested $1,000 in ZoomInfo shares during its IPO in June 2020 would now have an investment valued at $533.38.
Analyst comment
Positive news: ZoomInfo shares jumped 24.4% after Q4 results beat revenue expectations, indicating better-than-anticipated performance. Despite potential growth slowdown, revenue guidance was generally in line with expectations. Analysts predict market perception of ZoomInfo’s business will be positively impacted.
As an analyst, the market is expected to react positively to the news, leading to increased investor confidence and potential buying interest in ZoomInfo shares.
