Zoom Video shares offer favorable risk-reward, says RBC Capital

RBC Capital analyst Rishi Jaluria keeps an Outperform rating and $95 price target on Zoom Video after hosting in-person investor meetings with CFO Kelly Steckelberg and Head of IR Tom McCallum, with key topics for discussion being the monetization strategy for AI, the vision for contact center, and platform expansion. There remains a compelling long-term GenAI value add for Zoom, especially given the volume of unstructured data, but while the firm is optimistic on reaccelerating growth with solid margins, it is also acknowledging a lack of near-term catalysts and a challenging outlook could keep investors sidelined for a few quarters, the analyst tells investors in a research note. RBC adds however that at enterprise value 9-times the expected 2024 free cash flows, Zoom Video shares offer “favorable risk-reward”.