Market Overview

UPDATE: Bank of America Reiterates on RingCentral on Higher Growth Trajectory Confidence

Share:
Related RNG
Benzinga's Volume Movers
Benzinga's Top Initiations

In a report published Thursday, Bank of America analyst Kash Rangan reiterated a Buy rating on RingCentral (NYSE: RNG), and raised the price target from $22.00 to $25.00.

In the report, Bank of America noted, “We have higher confidence in the growth trajectory of the Office business (+67% Y/Y in 2013, +45% Y/Y in 2014E), which represented 65% of total MRR in 2013 (72% in 2014E). With the addition of video, we anticipate more customers shifting to the higher priced Office Enterprise Edition at a $10 price uplift from the Premium Edition.

"RNG is a young company generating solid growth, albeit with operating losses. Our $25 PO implies 7.9x CY14E EV/Revs and is a 20% premium to the comps given our view of RingCentral's better growth rate and large market opportunity. Our four-part valuation methodology includes: venture capital style margin estimates; lifetime value of customers (LTV); maintenance revenue analysis; and comparables.”

RingCentral closed on Wednesday at $21.88.

Latest Ratings for RNG

DateFirmActionFromTo
Aug 2015Canaccord GenuityInitiates Coverage onBuy
Jul 2015Raymond JamesUpgradesOutperformStrong Buy
Jul 2015JP MorganInitiates Coverage onOverweight

View More Analyst Ratings for RNG
View the Latest Analyst Ratings

Posted-In: Bank of America Kash RanganAnalyst Color Price Target Analyst Ratings

 

Related Articles (RNG)

Get Benzinga's Newsletters