RingCentral (RNG) AI Stock Analysis

• Market Cap: $2.57B
• Dividend Yield: N/A
• Average Volume (3M): 1.46M
• Price to Earnings (P/E): 209.1
• Beta (1Y): 1.55
• Revenue Growth: 5.45%
• EPS Growth: N/A
• Country: US
• Employees: 4,260
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 1.13
• Shares Outstanding: 76,760,180
• 10 Day Avg. Volume: 1,036,940
• 30 Day Avg. Volume: 1,461,722
• PEG Ratio: 0.87
• Price to Book (P/B): -5.85
• Price to Sales (P/S): 1.34
• P/FCF Ratio: 8.06
• Enterprise Value/Market Cap: 1.54
• Enterprise Value/Revenue: 1.59
• Enterprise Value/Gross Profit: 2.24
• Enterprise Value/Ebitda: 10.92
• 1Y Price Target: $31.83
• Price Target Upside: 7.57% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 4.32
• Revenue Forecast (FY): $2.51B

• Rating: 63 Neutral
• Price Target: $32.00 ▲(8.14% Upside)

RingCentral's overall stock score is driven by strong financial performance in revenue growth and cash flow, alongside positive technical indicators. However, profitability challenges and a negative valuation impact the score. The earnings call provided a positive outlook with AI product expansion and strategic partnerships, but highlighted some growth challenges.

Positive Factors

AI Product Momentum

The growth of AI products indicates a strong strategic focus on innovation, enhancing RingCentral's competitive edge and long-term revenue potential.

Free Cash Flow Growth

Strong free cash flow growth enhances financial flexibility, enabling reinvestment in growth initiatives and debt reduction, supporting long-term stability.

Strategic Partnerships

Expanding partnerships with major players like AT&T strengthens market position and broadens customer reach, supporting sustainable growth.

Negative Factors

High Leverage

High leverage limits financial flexibility and increases risk, potentially impacting the company's ability to invest in growth and weather economic downturns.

Profitability Concerns

Persistent profitability challenges could hinder long-term financial health, affecting the company's ability to sustain operations and invest in future growth.

Stock-Based Compensation Impact

High stock-based compensation dilutes shareholder value and can strain financial resources, affecting long-term profitability and investor returns.

RingCentral Business Overview & Revenue Model

Company Description

RingCentral, Inc. provides software-as-a-service solutions that enable businesses to communicate, collaborate, and connect in North America. The company offers business cloud communications and contact center solutions based on its Message Video Phone? platform. Its products include RingCentral Office that provides communication and collaboration across various modes, including high-definition voice, video, SMS, messaging and collaboration, conferencing, online meetings, and fax; RingCentral Contact Center, a collaborative contact center solution that delivers omni-channel; and RingCentral Engage Digital, a digital customer engagement platform that allows enterprises to interact with their customers. The company's products also comprise RingCentral Engage Voice, a cloud-based outbound/blended customer engagement platform for midsize and enterprise companies; RingCentral Video, a video meeting service which includes our RCV video and team messaging capabilities and offers video and audio conferencing, file sharing, contact, task, and calendar management. In addition, it offers RingCentral Professional, a cloud based virtual telephone service that provides inbound call answering and management services for professionals; and RingCentral Fax that provides online fax capabilities. The company serves a range of industries, including financial services, education, healthcare, legal services, real estate, retail, technology, insurance, construction, hospitality, and state and local government, as well as others. It sells its products through a network of direct sales representatives, as well as sales agents, resellers, and channel partners. RingCentral, Inc. has strategic partnerships with Alcatel-Lucent Enterprise; and Vodafone Business. The company was incorporated in 1999 and is headquartered in Belmont, California.

How the Company Makes Money

RingCentral generates revenue primarily through a subscription-based model, offering various pricing tiers for its services. The company has key revenue streams from its core products, including RingCentral Office, which combines voice, video, and messaging services, and RingCentral Contact Center. Additionally, RingCentral earns revenue through add-on services and features, such as advanced analytics and integrations with third-party applications. Significant partnerships with companies like Avaya and Cisco enhance its market presence, allowing it to reach a broader customer base and integrate its solutions with existing enterprise systems. The company's ongoing focus on expanding its international footprint and enhancing its product offerings also contributes to its revenue growth.

RingCentral Financial Statement Overview

Summary

RingCentral shows strong revenue growth and cash flow management, but struggles with profitability and financial stability due to high leverage and negative equity. Improvements in profitability and leverage are crucial for future financial health.

Income Statement

RingCentral has shown consistent revenue growth, with a TTM increase of 1.217% and a strong gross profit margin of 70.75%. However, the company struggles with profitability, as indicated by a negative net profit margin of -0.50% in the TTM. Despite improvements in EBIT and EBITDA margins, profitability remains a concern.

Balance Sheet

The balance sheet reveals high leverage, with a negative debt-to-equity ratio of -2.25 in the TTM, indicating financial instability. The negative stockholders' equity suggests potential risks, although there is a slight improvement in return on equity to 2.82% in the TTM.

Cash Flow

Cash flow metrics are a strong point for RingCentral, with a significant free cash flow growth rate of 7.91% in the TTM. The operating cash flow to net income ratio is healthy at 0.47, and the free cash flow to net income ratio is robust at 0.90, indicating efficient cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.49B	2.40B	2.20B	1.99B	1.59B	1.18B
Gross Profit	1.77B	1.69B	1.54B	1.35B	1.15B	860.05M
EBITDA	362.24M	236.58M	113.09M	-622.68M	-184.05M	42.83M
Net Income	13.24M	-58.29M	-165.24M	-879.17M	-376.25M	-83.00M
Balance Sheet
Total Assets	1.53B	1.78B	1.94B	2.07B	2.58B	2.18B
Cash, Cash Equivalents and Short-Term Investments	145.37M	242.81M	222.19M	269.98M	267.16M	639.85M
Total Debt	1.30B	1.58B	1.59B	1.68B	1.45B	1.46B
Total Liabilities	1.86B	2.33B	2.45B	2.56B	2.24B	1.87B
Stockholders Equity	-334.31M	-550.92M	-502.57M	-482.79M	338.97M	312.25M
Cash Flow
Free Cash Flow	558.15M	400.21M	323.92M	100.87M	-244.68M	-142.88M
Operating Cash Flow	601.32M	483.28M	399.66M	191.31M	152.15M	-35.19M
Investing Cash Flow	-106.16M	-109.36M	-90.45M	-87.21M	-396.83M	-107.69M
Financing Cash Flow	-562.67M	-351.08M	-358.02M	-98.22M	-127.05M	437.59M

RingCentral Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 29.59
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RNG, the sentiment is Positive. The current price of 29.59 is above the 20-day moving average (MA) of 27.86, above the 50-day MA of 28.10, and above the 200-day MA of 27.61, indicating a bullish trend. The MACD of 0.37 indicates Negative momentum. The RSI at 61.13 is Neutral, neither overbought nor oversold. The STOCH value of 86.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RNG.

RingCentral Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GTM	71 Outperform	$3.10B	31.38	6.51%	―	1.47%	1077.70%
RNG	63 Neutral	$2.57B	209.12	―	―	5.45%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
PRCH	57 Neutral	$986.28M	40.00	―	―	-2.13%	―
API	56 Neutral	$353.47M	78.42	0.84%	―	1.62%	―
ASAN	54 Neutral	$3.02B	―	-102.48%	―	9.47%	16.97%
EGHT	48 Neutral	$281.44M	―	-4.88%	―	0.25%	92.10%

RingCentral Corporate Events

RingCentral Refinances Credit Agreement with New Facilities

On September 11, 2025, RingCentral, Inc. entered into an Amendment and Restatement Agreement to refinance its existing credit agreement. This Restated Credit Agreement includes a $280 million revolving loan facility, a $310 million initial term loan facility, and a $650 million delayed draw term loan facility. The proceeds from these loans will be used for repaying existing loans, funding acquisitions, share repurchases, and other corporate purposes. The agreement also includes provisions for prepayments and adjustments to maturity dates based on the company’s financial metrics, impacting its liquidity management and financial strategy.