ZM Stock: $380 Target From Citi

By Amit Chowdhry ● July 21, 2021
  • The shares of Zoom Video Communications Inc (NASDAQ: ZM) have received a $380 price target from Citi. These are the details.

The shares of Zoom Video Communications Inc (NASDAQ: ZM) have received a $380 price target from Citi. And Citi analyst Tyler Radke is maintaining a “Neutral” rating on the company shares.

Zoom’s stock price saw a decline as investors have been weighing the all-stock deal to buy Five9 for $14.7 billion.

As part of the deal, Zoom will issue 0.5533 new shares for each Five9 shares outstanding. And Zoom did not highlight the specific financial benefits and earnings impacts in the news release. However, Zoom said that this deal will add a $24 billion addressable market according to MarketWatch.

Instead, Zoom highlighted the technology benefits associated with the Zoom Phone cloud-based operations.

Radke noted that the acquisition should be a potential positive for Zoom. And Radke acknowledged that this deal could be dilutive for Zoom’s margins as the valuation is relatively rich. But Radke noted that the regulatory risk is higher than usual as Zoom has been investigated over privacy and security issues over the past year.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.