Ooma (OOMA) AI Stock Analysis

• Market Cap: $344.45M
• Dividend Yield: N/A
• Average Volume (3M): 189.16K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.86
• Revenue Growth: 5.42%
• EPS Growth: 69.88%
• Country: US
• Employees: 1,186
• Sector: Technology
• Sector Strength: 88
• Industry: Telecommunications Services
• EPS (TTM): 0.23
• Shares Outstanding: 27,600,000
• 10 Day Avg. Volume: 187,694
• 30 Day Avg. Volume: 189,160
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.92
• Enterprise Value/Revenue: 1.21
• Enterprise Value/Gross Profit: 1.98
• Enterprise Value/Ebitda: 27.67
• 1Y Price Target: $16.50
• Price Target Upside: 32.21% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 55 Neutral
• Price Target: $12.50 ▲(0.16% Upside)

Ooma's overall stock score is driven by strong earnings call performance and positive cash flow generation. However, challenges in profitability and valuation weigh down the score. Technical indicators provide a mixed outlook, with short-term weakness but some medium-term strength.

Positive Factors

Revenue Growth

Ooma's consistent revenue growth highlights its expanding market presence and successful product offerings, indicating a robust business model.

Business User Growth

The significant growth in business subscriptions underscores Ooma's competitive position in the B2B market, enhancing long-term revenue stability.

Cash Flow Generation

Strong cash flow generation provides Ooma with financial flexibility to invest in growth opportunities and manage debt, supporting long-term sustainability.

Negative Factors

Profitability Challenges

Ongoing profitability issues, as indicated by negative margins, may hinder Ooma's ability to reinvest in its business and compete effectively.

Decline in Residential Revenue

The decline in residential revenue suggests potential challenges in maintaining consumer interest, which could impact overall revenue growth.

Flat Gross Margin

Flat gross margins indicate difficulty in improving cost efficiencies, which may limit profitability improvements despite revenue growth.

Ooma Business Overview & Revenue Model

Company Description

Ooma, Inc. provides communications services and related technologies for businesses and consumers in the United States and Canada. The company's products and services include Ooma Office, a cloud-based multi-user communications system for small and medium-sized businesses; Ooma Office Pro that offers services, including HD video meetings, call recording, enhanced call blocking, and voicemail transcription; Ooma Connect, which delivers fixed wireless internet connectivity; Ooma Managed Wi-Fi, a plug-and-play enterprise-grade Wi-Fi solution; and Ooma Enterprise, a unified-communications-as-a-service solution. It also provides Ooma AirDial, a plain old telephone service; Ooma Telo basic that provides unlimited personal calling within the Unites States; Ooma Premier, a suite of advanced calling features on a monthly or annual subscription basis; PureVoice HD, a residential phone services; Ooma Telo, a home communications solution designed to serve as the primary phone line in the home; and Ooma Telo 4G, which combines the Ooma Telo base station with the Ooma 4G Cellular Adapter and battery back-up. In addition, the company offers Ooma Mobile HD app that allows users to make and receive phone calls and access Ooma features and settings; Ooma Telo Air, a wireless Ooma Telo with built-in Wi-Fi and Bluetooth; Ooma Smart Security, a security and monitoring platform; and Talkatone mobile app. It offers its products through direct sales, distributors, retailers, and resellers, as well as online. Ooma, Inc. was incorporated in 2003 and is headquartered in Sunnyvale, California.

How the Company Makes Money

Ooma generates revenue primarily through subscription-based services, including monthly and annual fees for its residential and business VoIP plans. The company offers various tiers of service with different features, allowing it to capture a wide range of customers from individual consumers to small businesses. Additional revenue streams include the sale of hardware products, such as the Ooma Telo device and accessories. Ooma also benefits from partnerships with other technology providers and telecommunications companies, which helps to expand its customer base and enhance its service offerings. Furthermore, Ooma generates revenue through optional add-on services like international calling and advanced features, contributing to its overall earnings.

Ooma Financial Statement Overview

Summary

Ooma shows solid revenue growth and strong gross margins, but faces profitability challenges with negative net and EBIT margins. The balance sheet is stable with low leverage, and cash flow performance is strong, highlighted by significant free cash flow growth.

Income Statement

Ooma demonstrates consistent revenue growth with a TTM growth rate of 9.5% compared to the previous year. The gross profit margin stands strong at 60.9% for TTM, indicating efficient cost management. However, the company is facing challenges with profitability as reflected in the negative net profit margin of -1.9% and negative EBIT margin of -1.6%. Despite these challenges, the EBITDA margin of 3.3% suggests potential for operational improvements.

Balance Sheet

The balance sheet displays a healthy equity ratio of 59.0% and a manageable debt-to-equity ratio of 0.18, indicating financial stability. Nonetheless, the return on equity is negative, at -5.6%, due to the net losses, pointing towards inefficiencies in generating returns for shareholders.

Cash Flow

Ooma's cash flow is robust, highlighted by a significant free cash flow growth rate of 235.5% from 2024 to 2025. The operating cash flow to net income ratio is strong at -5.5, indicating effective cash generation despite reported net losses. The free cash flow to net income ratio is -4.2, suggesting that the company is generating adequate cash relative to its net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	261.62M	256.85M	236.74M	216.16M	192.29M	168.95M
Gross Profit	159.64M	156.02M	147.23M	137.65M	118.44M	104.80M
EBITDA	11.43M	6.20M	8.18M	3.28M	5.43M	4.60M
Net Income	-1.51M	-6.90M	-835.00K	-3.65M	-1.57M	-2.44M
Balance Sheet
Total Assets	150.09M	149.19M	159.25M	131.00M	109.25M	89.10M
Cash, Cash Equivalents and Short-Term Investments	19.56M	17.87M	17.54M	26.86M	31.28M	28.31M
Total Debt	11.59M	15.95M	29.68M	14.04M	14.45M	2.81M
Total Liabilities	61.97M	63.92M	81.17M	67.86M	58.20M	49.55M
Stockholders Equity	88.12M	85.28M	78.09M	63.14M	51.06M	39.55M
Cash Flow
Free Cash Flow	20.21M	20.16M	6.11M	3.56M	2.45M	1.21M
Operating Cash Flow	26.00M	26.61M	12.27M	8.77M	6.66M	4.37M
Investing Cash Flow	-5.79M	-6.45M	-35.33M	-6.15M	-4.89M	229.00K
Financing Cash Flow	-17.23M	-19.82M	16.45M	1.84M	601.00K	1.02M

Ooma Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 12.48
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OOMA, the sentiment is Negative. The current price of 12.48 is below the 20-day moving average (MA) of 12.79, above the 50-day MA of 12.16, and below the 200-day MA of 13.16, indicating a neutral trend. The MACD of 0.12 indicates Positive momentum. The RSI at 48.23 is Neutral, neither overbought nor oversold. The STOCH value of 15.66 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for OOMA.

Ooma Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RDCM	76 Outperform	$229.94M	25.30	―	―	18.18%	89.73%
SIFY	61 Neutral	$932.60M	―	-3.90%	―	10.20%	―
WOW	60 Neutral	$441.40M	-6.55	-28.16%	―	-8.67%	63.35%
OOMA	55 Neutral	$344.45M	―	-1.78%	―	5.42%	69.88%
RBBN	54 Neutral	$664.06M	-14.80	-13.40%	―	7.68%	18.65%
ATNI	48 Neutral	$237.86M	-4.63	-9.83%	6.38%	-5.33%	-334.05%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Ooma Corporate Events

Ooma Approves Amendments to Equity Plans

At the 2025 Annual Meeting of Stockholders held on June 5, 2025, Ooma, Inc. announced the approval of amendments to its 2015 Equity Incentive Plan and 2015 Employee Stock Purchase Plan. These amendments increase the number of shares authorized for issuance by 330,000 and 795,144 shares, respectively, potentially enhancing the company’s ability to attract and retain talent through equity compensation.

Ooma Stockholders Approve Key Proposals at Annual Meeting

At the annual meeting held on June 5, 2025, Ooma, Inc. stockholders voted on five key proposals. These included the election of directors, ratification of KPMG LLP as the independent accounting firm, approval of executive compensation, and amendments to the company’s equity incentive and employee stock purchase plans. The approval of these proposals ensures continuity in leadership and financial oversight, while also extending the company’s incentive plans, which are crucial for employee retention and motivation.