Piper Sandler has reduced its price target on ZoomInfo Technologies (NASDAQ:ZI) to $8.00 from $9.00 while keeping a Neutral rating on the shares. The firm pointed to advances in ZoomInfo's repositioning - notably stronger traction in larger accounts - but flagged continued headwinds among smaller customers.
ZoomInfo was trading at $7.32 at the time referenced. InvestingPro Fair Value models suggest the stock remains undervalued despite a year-to-date decline of more than 28%.
Upmarket gains and margin strength
Piper Sandler highlighted that ZoomInfo's upmarket business now accounts for 74% of Annual Contract Value (ACV) and is expanding at a 6% year-over-year pace. The company also reported very high gross profit margins of 87.37%, a metric that InvestingPro notes gives ZoomInfo financial flexibility while it executes its turnaround.
Downmarket pressure persists
By contrast, the downmarket segment represents 26% of ACV and remains a drag, with a 10% year-over-year decline in demand. This bifurcated performance - a healthier upmarket alongside a contracting downmarket - underpins much of the current analyst debate over the stock.
Quarterly results and operational cues
ZoomInfo's fourth-quarter results featured a revenue beat and stronger profitability on a non-GAAP basis. The company exceeded its midpoint revenue guidance by $10.6 million in Q4, supported by solid Copilot renewals and Operations revenue growth running above 20% year-over-year. Non-GAAP EPS came in at $0.32, topping the consensus estimate of $0.28. InvestingPro Tips indicate net income is anticipated to grow this year, and 22 analysts have revised earnings estimates upward for the upcoming period.
Guidance and analyst reactions
For fiscal 2026, ZoomInfo's growth guidance is centered on a midpoint of 0.6% year-over-year, slightly below consensus of 1.3%. Piper Sandler characterizes this outlook as assuming stable to slowing expansion in the upmarket and further deterioration in the downmarket.
Piper Sandler said it will hold its Neutral recommendation until there is greater clarity around a sustainable return to meaningful growth, and the firm lowered its price target to reflect reduced estimates. Other firms have taken a range of positions: Needham reiterated a Buy rating with a $15.00 price target following the Q4 performance; Citi kept a Sell rating at a $6.50 target; Citizens downgraded the stock from Market Perform to Market Underperform and set a $6.00 target; DA Davidson trimmed its price target to $7.00 while maintaining Neutral; and Canaccord Genuity lowered its target to $12.00 but kept a Buy rating, citing evidence of stability and new product rollouts.
What remains uncertain
Even with the recent quarterly beat and strong gross margins, the split between upmarket progress and downmarket weakness leaves questions about how quickly ZoomInfo can return to consistent, meaningful growth. Analysts remain divided on valuation and trajectory, reflecting differing interpretations of the company's ability to stabilize and expand revenue across segments.
This analysis focuses on the data points presented by the company and recent analyst commentary and does not introduce additional forecasts or estimates beyond those reported.