Analyst Sachin Mittal of DBS maintained a Buy rating on Zoom Video Communications (ZM – Research Report), retaining the price target of $102.00.
Sachin Mittal has given his Buy rating due to a combination of factors that highlight Zoom Video Communications’ potential for growth and strategic positioning. The company’s effective cost control has resulted in adjusted EPS exceeding consensus expectations, while revenue growth remains steady. Despite a slight dip in projected revenue growth for FY1/26, the company’s freemium strategy continues to expand its customer base, converting free users to paid plans, which was particularly successful during the pandemic.
Sachin also notes Zoom’s investment in a unified communications platform, which includes a variety of products such as chat, phone, and video conferencing, indicating long-term growth potential. The introduction of the AI Companion Add-On, set to be monetized in 2025, represents a strategic shift towards AI-driven revenue streams, which is expected to reduce churn and integrate seamlessly with enterprise workflows. These factors, along with a revised target price of USD102 per share, support the Buy recommendation, despite challenges such as increased competition and reduced demand for video conferencing post-pandemic.
Mittal covers the Technology sector, focusing on stocks such as Cognizant, Grab, and Zoom Video Communications. According to TipRanks, Mittal has an average return of 23.4% and a 71.01% success rate on recommended stocks.
In another report released on February 25, Wedbush also maintained a Buy rating on the stock with a $95.00 price target.