Mizuho Securities analyst Siti Panigrahi has reiterated their neutral stance on RNG stock, giving a Hold rating on February 25.
Siti Panigrahi has given his Hold rating due to a combination of factors impacting RingCentral’s current market position and financial strategy. The company’s growth in the UCaaS market has slowed, with the market itself growing at a mid-single-digit rate. Despite this, RingCentral has maintained its market share and introduced new products that have started to gain traction, contributing to its revenue stream. However, the deceleration in top-line growth from 25% in 2022 to 9% in 2024, and a further projected slowdown to 5% in 2025, indicates a cautious outlook.
Management’s focus on improving profitability through cost discipline and operational efficiency has led to an increase in operating margins and free cash flow. The company aims to strengthen its financial profile by reducing stock-based compensation and gross debt. While these efforts are commendable, the overall growth outlook remains modest, prompting a Hold rating. The valuation of RingCentral’s stock, trading at a multiple in line with peers, further supports this neutral stance, as the company continues to navigate a mature market environment while investing in AI-driven innovations.
According to TipRanks, Panigrahi is a 2-star analyst with an average return of -0.3% and a 46.59% success rate. Panigrahi covers the Technology sector, focusing on stocks such as Intuit, RingCentral, and Paycom.
In another report released on February 25, Robert W. Baird also maintained a Hold rating on the stock with a $32.00 price target.