Zoom’s Strategic Initiatives and Financial Performance Justify Buy Rating with USD 102 Target

DBS analyst Sachin Mittal has maintained their bullish stance on ZM stock, giving a Buy rating on May 23.

Sachin Mittal has given his Buy rating due to a combination of factors including Zoom’s recent financial performance and strategic initiatives. The company’s adjusted earnings per share have surpassed expectations, indicating strong financial health. Additionally, Zoom has raised its future earnings guidance, driven by pricing improvements and increased adoption of AI technologies.
Zoom’s freemium strategy has proven effective in expanding its customer base, transitioning free users to paid plans. Furthermore, the company is investing in a unified communications platform, which includes various features like chat and video conferencing, showing potential for long-term growth. The direct monetization of AI tools also signals a positive outlook, suggesting recovery and growth in the coming years. Despite challenges such as reduced demand post-pandemic and increased competition, these strategic moves support the Buy rating with a target price of USD 102.

In another report released on May 23, Mizuho Securities also reiterated a Buy rating on the stock with a $95.00 price target.