ZoomInfo (ZI) is riding high after a strong fourth-quarter earnings report sent its stock soaring, but that’s not stopping founder and CEO Henry Schuck from doubling down on his belief in the company’s long-term value.
In fact, Schuck is signaling even more aggressive share repurchases, convinced that the market is still underestimating ZoomInfo’s potential.
“We think that over the last year and today … the stock price is below the intrinsic value that we think it deserves,” Schuck said on Yahoo Finance’s Opening Bid podcast.
And as long as it’s below that value, we’re going to be buyers of the stock.
This strong conviction follows a period where ZoomInfo shares have been trading at depressed levels.
While the stock rose more than 22% to $11.65 in early trading on Wednesday after the earnings release, it was still down 44% over the past year prior to this recent surge.
ZoomInfo has been actively buying back its stock, with a significant portion of the repurchases occurring “under the radar.”
In the past year, the company repurchased 46 million shares, representing 12% of the outstanding shares, for a total of $562.3 million.
To further underscore its commitment to shareholder value, the board has authorized an additional $500 million share repurchase plan.
Schuck, who founded the data intelligence company in 2007, has also been personally investing in ZoomInfo shares.
Yahoo Finance data shows two large purchases by Schuck in August and November of 2024.
“Over the last 18 or so months, we’ve retired about 18% of the company’s shares,” Schuck added.
We continue to think that there’s a buying opportunity for us to continue to retire shares and drive shareholder value by doing that.
Schuck believes ZoomInfo is beyond an “inflection point,” thanks to aggressive investments in artificial intelligence over the past two years.
ZoomInfo’s new CoPilot tool, which leverages AI to enhance sales and marketing efforts, has already generated $150 million in annual contract value to date, demonstrating the company’s success in integrating AI into its core offerings.
The positive impact of these investments is also evident in the company’s customer base.
In the fourth quarter, the number of customers spending more than $100,000 annually on the platform rose 3% year-over-year, marking the first quarter of positive year-on-year growth since the third quarter of 2023.
Despite the early AI success, ZoomInfo is taking a pragmatic approach to its initial 2025 guidance, acknowledging that its small and medium-size business (SMB) customers remain mindful of spending amid an uncertain economic outlook.
The company expects full-year sales and operating income to remain relatively unchanged year-over-year in 2025.
While ZoomInfo’s earnings and buyback plans have generated excitement, some analysts remain cautious.
“While 4Q24 results indicated a positive inflection point for net recurring revenue, we remain on the sidelines given macro headwinds,” D.A. Davidson analyst Gil Luria wrote in a note.
Luria maintained a Neutral rating on the stock with a $13 price target, suggesting that ZoomInfo still has work to do to convince investors of its long-term growth potential.
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