Ooma’s Strategic Growth and Valuation Justify Buy Rating

William Blair analyst Arjun Bhatia has maintained their bullish stance on OOMA stock, giving a Buy rating on May 29.

Arjun Bhatia has given his Buy rating due to a combination of factors that suggest strong future growth prospects for Ooma. The company is expected to benefit from its strategic initiatives, including the penetration of the POTS opportunity with its AirDial product, which is experiencing significant momentum. Additionally, Ooma’s strategic partnerships are anticipated to further drive growth.
Another reason for the Buy rating is the company’s valuation, which currently trades at approximately 2.0 times the estimated gross profit for 2026. This valuation is in line with the median of its communications SaaS peer group. As Ooma continues to execute its growth strategy, increase its mix of Pro and Pro Plus users, and realize synergies from its acquisition of 2600Hz, it is expected that the stock will align more closely with its peers, justifying the Buy recommendation.

In another report released on May 29, Northland Securities also maintained a Buy rating on the stock with a $18.00 price target.

Based on the recent corporate insider activity of 80 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of OOMA in relation to earlier this year.