RingCentral (RNG)
NYSE:RNG
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RingCentral
(NYSE:RNG)
Select Model
Select Model
Rating:66Neutral
Price Target:
$42.00
▲(14.41% Upside)
Action:ReiteratedDate:02/24/26
The score is driven primarily by strong free-cash-flow generation and improving profitability, supported by bullish technical momentum. These positives are tempered by balance-sheet constraints (high debt and negative equity) and a very high P/E that leaves little room for execution missteps, while earnings-call guidance is favorable on margins/FCF but still points to only modest top-line growth and near-term refinancing/SBC risks.
Positive Factors
Recurring subscription revenue dominance
A subscription-heavy model (>95% of sales) provides durable, contract-based recurring revenue and predictable cash flows. This supports multi-quarter revenue visibility, enables upsell/cross-sell of premium tiers and CCaaS, and reduces reliance on one-time sales for steady operating performance.
Negative Factors
High leverage and negative equity
Substantial debt and negative shareholders’ equity constrain financial flexibility and increase interest-rate and refinancing sensitivity. Negative equity can limit strategic options, raise covenant and market-perception risks, and makes capital-structure improvements a multi-quarter structural priority.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring subscription revenue dominance
A subscription-heavy model (>95% of sales) provides durable, contract-based recurring revenue and predictable cash flows. This supports multi-quarter revenue visibility, enables upsell/cross-sell of premium tiers and CCaaS, and reduces reliance on one-time sales for steady operating performance.
Read all positive factors
RingCentral (RNG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.25B
Dividend YieldN/A
Average Volume (3M)3.50M
Price to Earnings (P/E)27.1
Beta (1Y)1.49
Revenue Growth5.45%
EPS GrowthN/A
CountryUS
Employees4,260
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)1.18
Shares Outstanding74,268,036
10 Day Avg. Volume1,921,236
30 Day Avg. Volume3,498,414
Financial Highlights & Ratios
PEG Ratio-0.32
Price to Book (P/B)-4.23
Price to Sales (P/S)0.99
P/FCF Ratio4.23
Enterprise Value/Market Cap1.40
Enterprise Value/Revenue1.81
Enterprise Value/Gross Profit2.54
Enterprise Value/Ebitda11.74
Forecast
1Y Price Target
$36.50Price Target Upside-0.57% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)4.85
Revenue Forecast (FY)$2.63B
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 P...
How the Company Makes Money
RingCentral primarily makes money through recurring subscription revenue from its cloud communications products. Customers typically pay per user/seat (and/or by tiered plans and feature bundles) for access to its UCaaS products (e.g., cloud busin...
RingCentral Key Performance Indicators (KPIs)
Any
Subscription ARR
Shows the annual recurring revenue from subscriptions, reflecting the stability and predictability of the company's income stream.
Shows the annual recurring revenue from subscriptions, reflecting the stability and predictability of the company's income stream.
Data provided by:
The Fly
The FlyRingCentral Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 12, 2026
Earnings Call Sentiment Positive
The call communicates strong financial discipline and meaningful progress: record free cash flow (+32% YoY), margin expansion (non-GAAP operating margin ~22.5%, GAAP profit for the year), significant AI product momentum (new products $100M ARR; AI ARR tripled; RCAI customers ~10% of ARR), balance sheet deleveraging and new shareholder returns (first quarterly dividend + increased buyback authorization). Offsetting items are modest top-line growth (mid-single digits), enterprise pricing pressure due to COVID lapping, remaining elevated SBC (guidance ~9% of revenue in 2026), and a near-term convertible refinancing need. Overall, positive operational and cash-flow improvements and accelerating AI adoption outweigh the near-term growth and financing headwinds.Positive Updates
Revenue and Subscription Growth
Full-year total revenue of $2.52B, up 4.8% year-over-year; full-year subscription revenue of $2.43B, up 5.6% YoY. Q4 subscription revenue $622M (+5.5% YoY) and Q4 total revenue $644M (+4.8% YoY).
Negative Updates
Modest Top-Line Growth and Enterprise Pricing Pressure
Revenue growth remained mid-single digits (total revenue +4.8% FY), reflecting modest expansion. Management highlighted increased pricing pressure in the enterprise segment tied to COVID lapping contracts; this headwind is expected to subside by 2027 but suppresses near-term enterprise growth.
Read all updates
Q4-2025 Updates
Positive
Negative
Revenue and Subscription Growth
Full-year total revenue of $2.52B, up 4.8% year-over-year; full-year subscription revenue of $2.43B, up 5.6% YoY. Q4 subscription revenue $622M (+5.5% YoY) and Q4 total revenue $644M (+4.8% YoY).
Read all positive updates
Company Guidance
RingCentral guided full‑year 2026 subscription revenue growth of 4.5%–5.5% and total revenue growth of 4%–5%, with GAAP operating margin of 8.6%–9.6% (≈430 bps expansion at the midpoint) and non‑GAAP operating margin of 23%–23.5% (≈75 bps expansion at the midpoint). Management expects free cash flow of $580M–$600M (≈$590M midpoint, +11% YoY), free cash flow per share of $6.67–$6.94 based on 86.5–87.0M diluted shares (≈+17% at midpoint), non‑GAAP EPS of $4.76–$4.97 (≈+11% at midpoint), SBC of $240M–$250M (≈9% of revenue at midpoint) with in‑year new stock grants of $145M–$155M, and noted a longer‑term steady‑state SBC goal of 3%–4% and a target GAAP margin of ~20% in 3–4 years. Q1 2026 guidance is subscription revenue $622M–$625M, total revenue $640M–$645M, GAAP operating margin 7.1%–8.2%, non‑GAAP operating margin 22.8%–22.9%, non‑GAAP EPS $1.16–$1.19 and SBC $60M–$65M. They also reiterated capital priorities to reduce gross debt to $1B by end‑2026, address a $609M convertible due March 2026 (with $955M undrawn credit available), expand buybacks (total authorization $500M) and initiate a $0.075 quarterly dividend.RingCentral Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
28
Negative
Cash Flow
82
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.52B | 2.40B | 2.20B | 1.99B | 1.59B |
| Gross Profit | 1.79B | 1.69B | 1.54B | 1.35B | 1.15B |
| EBITDA | 381.43M | 236.58M | 113.09M | -622.68M | -184.05M |
| Net Income | 43.39M | -58.29M | -165.24M | -879.17M | -376.25M |
Balance Sheet | |||||
| Total Assets | 1.48B | 1.78B | 1.94B | 2.07B | 2.58B |
| Cash, Cash Equivalents and Short-Term Investments | 132.56M | 242.81M | 222.19M | 269.98M | 267.16M |
| Total Debt | 1.48B | 1.58B | 1.59B | 1.68B | 1.45B |
| Total Liabilities | 2.07B | 2.33B | 2.45B | 2.56B | 2.24B |
| Stockholders Equity | -588.12M | -550.92M | -502.57M | -482.79M | 338.97M |
Cash Flow | |||||
| Free Cash Flow | 587.32M | 400.21M | 323.92M | 100.87M | -244.68M |
| Operating Cash Flow | 617.43M | 483.28M | 399.66M | 191.31M | 152.15M |
| Investing Cash Flow | -107.97M | -109.36M | -90.45M | -87.21M | -396.83M |
| Financing Cash Flow | -623.42M | -351.08M | -358.02M | -98.22M | -127.05M |
RingCentral Technical Analysis
Neutral
36.71
Price Trends
32.18
Positive
30.40
Positive
29.47
Positive
Market Momentum
1.43
Positive
51.99
Neutral
29.66
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RNG, the sentiment is Neutral. The current price of 36.71 is below the 20-day moving average (MA) of 38.07, above the 50-day MA of 32.18, and above the 200-day MA of 29.47, indicating a neutral trend. The MACD of 1.43 indicates Positive momentum. The RSI at 51.99 is Neutral, neither overbought nor oversold. The STOCH value of 29.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RNG.
RingCentral Risk Analysis
RingCentral disclosed 55 risk factors in its most recent earnings report. RingCentral reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
RingCentral Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $3.25B | 27.07 | -8.90% | ― | 5.45% | ― | |
66 Neutral | $1.76B | 26.41 | 7.96% | ― | 1.47% | 1077.70% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
57 Neutral | $331.03M | 39.18 | 1.68% | ― | 1.62% | ― | |
57 Neutral | $1.54B | -12.84 | -94.12% | ― | 9.47% | 16.97% | |
56 Neutral | $804.61M | 61.80 | -13.21% | ― | -2.13% | ― | |
55 Neutral | $259.13M | 13.24 | -2.93% | ― | 0.25% | 92.10% |
* Technology Sector Average
RNG
RingCentral
36.71
9.20
33.44%
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RingCentral Corporate Events
Business Operations and StrategyStock BuybackDividendsFinancial Disclosures
RingCentral Announces First Dividend Amid Strong Cash Growth
Positive
Feb 19, 2026
RingCentral reported fourth-quarter and full-year 2025 results on February 19, 2026, showing total annual revenue of $2.52 billion, up 5% year over year, with subscriptions revenue rising 6% and now exceeding 95% of sales. The company expanded GAA...
Executive/Board ChangesShareholder Meetings
RingCentral Stockholders Back Directors and Governance Measures
Positive
Jan 5, 2026
On December 31, 2025, RingCentral, Inc. held its 2025 annual meeting of stockholders virtually, with approximately 94.66% of eligible votes represented, confirming strong shareholder participation across its multiple classes of stock. Stockholders...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.