ZoomInfo Analyst Discusses Multiple Growth Vectors, Strong Operating Structure

Morgan Stanley analyst Elizabeth Porter affirmed ZoomInfo Technologies Inc ZI with an Overweight rating and a price target of $66.
Porter's deep dive analysis increases confidence that ZoomInfo can durably grow revenue 30%+ over the next three years while also generating 40%+ operating margins, resulting in one of the most efficient unit economics in the SaaS peer group.
She notes that sustaining 30%+ revenue CAGR through 2024 is supported by 1) a significant greenfield opportunity with low single-digit penetration, 2) uplift in annualized contract value (ACV) as users adopt Advanced Functionality workflows, and 3) improving retention from stickier software adoption beyond company and contact data.
The analyst points out that sustainable topline growth combined with a mid-40% operating margin yields a strong FCF growth engine, providing scale to enable investment ahead of peers.
While shares trade at a premium EV/S/G multiple, she believes this does not correctly consider the best-in-class profitability and sees shares trading at a discount on EV/FCF/G and PEG.
Her price target reflects a premium to the SaaS group average, given a unique combination of growth and profitability with a Rule of 40 at 80%+, well ahead of the ~25% SaaS average.
Price Target: ZI shares traded higher by 0.72% at $46.21 on the last check Wednesday.