Evercore adjusts valuation but maintains positive rating
Evercore ISI cut its price target on Five9 to $24 from $40 and left an Outperform rating in place on Thursday. The move follows Five9’s reported fourth-quarter results and management commentary on near-term growth expectations.
Quarterly performance and revenue composition
Five9 reported total revenues for the fourth quarter that rose 7.8% compared with the same period last year. Management noted the quarter included difficult year-over-year comparisons related to the timing of a large healthcare client coming online - and said the fourth quarter represented the final period of those tough comparisons.
The company’s commercial segment, which represents roughly 9% of overall revenue, lagged expectations during the quarter. Management attributed the underperformance to a temporary shortfall in sales capacity and reduced marketing investment in the third quarter, and indicated the commercial business is expected to normalize in the next quarter.
Guidance for 2026 and initial 2027 outlook
For full-year 2026, Five9 provided an outlook centered at 9.1% growth at the midpoint. That figure is modestly below prior third-quarter commentary that had implied approximately 9.5% year-over-year growth. Management continued to expect double-digit growth in the second half of 2026 and supplied an initial 2027 growth range of 10% to 15%.
The company is included among the more than 1,400 U.S. equities covered by InvestingPro Research Reports, which the firm positions as a resource for investors seeking additional analysis on growth trajectory and valuation.
Technology positioning and competitive claims
Five9 described its competitive advantages as rooted in proprietary conversational data and orchestration capabilities that span channels, backend systems, human agents, and AI agents. Management emphasized that while large language models are a foundational technology, they believe such models alone are not sufficient to run a full-scale customer service operation without Five9’s broader platform and integration capabilities.
Leadership change and strategic partnerships
The company disclosed an Amended and Restated Employment Transition Agreement that formalizes a leadership handover. Current CEO Michael Burkland will remain in his role until February 2, 2026, at which time Amit Mathradas is slated to assume the CEO position.
Five9 also expanded its collaboration with Google Cloud, introducing an Enterprise CX AI solution that combines Five9’s AI-Infused Intelligent CX Platform with Google Cloud technology to enhance customer interactions across channels.
Analyst moves and other corporate notes
In other analyst activity, Piper Sandler downgraded Five9 from Overweight to Neutral, citing concerns about growth while noting potential improvements in free cash flow. Needham left its Buy rating unchanged, pointing to a long-term opportunity tied to cloud migration.
Separately, JFrog Ltd. appointed Genefa Murphy as Chief Marketing Officer; Murphy previously worked at Udemy and held earlier roles at Five9.
What this means
Evercore’s price-target reduction, the company’s near-term guidance and the commercial segment’s temporary weakness are central developments investors and market participants will weigh as they assess Five9’s growth trajectory and valuation going into 2026 and the newly provided preliminary 2027 range.