Benzinga | Feb 23, 2021 01:44AM EST

Zoom Gets Piper Sandler Price Upgrade On Product, Customer Momentum

ZoomInfo Technologies Inc's (NASDAQ:ZI) multiple product and new customer levers could sustain 30%-plus growth going forward, according to Brent Bracelin of Piper Sandler.

The Zoom Analyst: Bracelin maintained an Overweight rating on the ZoomInfo stock and upped his price target to $70 from $59.

The Zoom Thesis: The analyst raised his revenue estimates for the company by $60 million for 2021 and $114 million for 2022, representing a growth of 37% and 32%.

Piper Sandler's increased revenue expectations are based on new customer momentum, improving net expansion rates at existing customers, and new product potential along with untapped international expansion.

"The pace of change during Q4 and entering 2021 strengthens our confidence in the growth trajectory over the next 3-5 years, particularly given an expanding product portfolio," Bracelin wrote in a note.

The investment bank said that the new customer additions and 60% plus enterprise growth contributed to a $9 million revenue beat as ZoomInfo's top-line growth accelerate to 45% in the fourth quarter.

Bracelin pointed to the addition of 130 net new $100,000 plus customers in Q4 versus the addition of 70 such customers in the last quarter.

The Piper Sandler analyst said that the Q4 installed base has reached 20,000 and is "noteworthy."

Pointing to Zoom's integration with Salesforce.com, Inc (NYSE:CRM), Bracelin noted the latter has 150,000 customers overall.

"We see ample opportunity for ZI to expand new logos by 25-30% annually for the next several years as it becomes an integral part of a modern sales stack."

Zoom Price Action: Zoom shares rose nearly 11.9% in the after-hours trading on Monday to $57.45 after closing 6.25% lower at $51.32.