Zoom Video (ZM) PT Raised to $105 at BofA Securities

BofA Securities analyst Michael Funk raised the price target on Zoom Video (NASDAQ: ZM) to $105.00 (from $90.00) while maintaining a Neutral rating.

The analyst comments "Zoom delivered a solid start to FY27, with Q1 revenue growing 5.5% year over year to $1.24bn, exceeding guidance of $1.22bn. Enterprise remained the primary growth engine, expanding 7.2% and now representing 61% of revenue, supported by continued traction in large customers and multi-product adoption. Non-GAAP operating margin expanding 130 basis points year over year to 41.1% and gross margin improving to 79.9%. Free cash flow was strong with a 40% margin. Zoom increased its share repurchase program by $1bn. We reiterate our Neutral and increase our PO to $105 (from $90), which is based on a CY26E EV/FCF multiple of 13x (from 11x). We think a higher multiple is justified by improving revenue growth and FCF generation. Our Neutral rating is based on competitive intensity and our view that the current multiple reflects projected midsingle digit revenue growth and historic and projected margin expansion."

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