Market News

ZoomInfo Outperforms in Q3; Shares Up 3.8%

ZoomInfo Technologies, Inc. (ZI) reported impressive third-quarter results, with both earnings and revenue exceeding expectations, pushing shares up 3.8% during the extended trading session on November 1.

ZoomInfo is a cloud-based technology platform, providing data on organizations and professionals to sales and marketing teams. ZI has a market cap of $28.15 billion and its shares have gained 85% over the past year.

The company’s adjusted earnings rose 18.2% year-over-year to $0.13 per share, 1 cent better than analyst estimates of $0.12 per share.

Furthermore, the company reported $197.6 million in revenues, a 60% increase compared to the same quarter last year, while outpacing Street estimates of $183.76 million. (See Insiders’ Hot Stocks on TipRanks)

Happy with the company’s quarterly performance, Henry Schuck, Founder and CEO of ZI, said, “ZoomInfo delivered exceptional results, with another quarter of accelerating revenue growth, and strong free cash flow generation… We continue to execute across all areas of the business as we build a category-defining company by delivering end-to-end success for go-to-market teams worldwide.”

Based on the continued business momentum, the company expects its fourth-quarter revenue to fall in the range of $206-$208 million, higher than the consensus estimate of $195.3 million. Meanwhile, Q4 adjusted earnings are expected to be between $0.12-$0.13 per share, against the consensus estimate of $0.13 per share.

Additionally, ZI’s FY 2021 expectations have been revised upwards to reflect an optimistic Q4 guidance. FY21 revenue and adjusted earnings per share are now expected to fall in the range of $731-$733 million and $0.51-$0.52 per share, respectively.

Weighing in on its Q3 results and guidance, JMP Securities analyst Patrick Walravens maintained a Hold rating on the stock.

Walravens said, “ZoomInfo addresses a massive TAM estimated at ~$70 billion, is ably led by founder Henry Schuck, and is aggressively expanding its product footprint to capture the entire revenue cycle including intelligence, orchestration, and engagement, but needs to keep an eye on the private players in the space including Gong, Outreach, and Salesloft, who each come from their own area of strength and are expanding outwards.”    

With 12 Buys and 1 Hold, the stock commands a Strong Buy consensus rating. At the time of writing, the average ZoomInfo Technologies price target of $81.15 implied 18.71% upside potential to current levels.

Looking at the ZI website traffic, in September, ZoomInfo’s website recorded a 31.94% monthly increase in visits, against the same quarter last year. Similarly, year-to-date website traffic growth almost doubled.

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