Is there a recession right now? It depends on who you ask. But for ZoomInfo Technologies (NASDAQ:ZI), there might as well be one on because Deutsche Bank is acting like ZoomInfo is right in the middle of one. A rating cut therein sent ZoomInfo plunging thanks to several factors working against the interactive services supplier.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Deutsche Bank analysts cut ZoomInfo from Buy to Hold, thanks in large part to ZoomInfo’s less-than-stellar second quarter, as well as its own move to cut its outlook for 2023. Essentially, ZoomInfo quantified what most of us knew, if only vaguely, was coming: companies are cutting back on their software budgets, and that means services like ZoomInfo—which are valuable, but not necessarily every minute—are on the receiving end. With artificial intelligence moving in on virtually every front, determining what software will be valuable and what software will be less so will be increasingly difficult and increasingly necessary to do.
That wasn’t the only problem Deutsche Bank had. Deutsche Bank has a particular problem with management visibility from ZoomInfo, noted one report, as well as a potential for downside risk. However, Deutsche Bank also noted that its analysts consider a bottom on the horizon, as there was already one major spending reduction that hit the market earlier in 2023. Deutsche Bank might have been concerned, but JPMorgan seemed less so. It recently cut its price target from $31 to $26, but it maintained its “overweight” rating.
In fact, a look at the broader analyst community says mainly good things. With 11 Buy ratings and four Hold, ZoomInfo Technologies stock is considered a Moderate Buy. Further, with an average price target of $28, ZoomInfo Technologies stock comes with a 46.83% upside potential.