Zoom Video Communications
When meetings and classes moved online due to the pandemic, business at Zoom Video Communications (ZM) flourished.
But as the economy reopened, there have been concerns about the growth potential of this video communications company. It didn’t help the case that sentiment towards tech stocks in general wasn’t exactly bullish in 2022.
Over the past 12 months, Zoom shares have fallen 40%.
And that could give contrarian investors something to think about. Zoom had approximately 213,300 enterprise customers as of Feb. 27, 2023, up 12% year-over-year.
If the hybrid work environment is here to stay, it would be good news for Zoom.
RBC Capital Markets analyst Rishi Jaluria has an ‘outperform’ rating on Zoom and a price target of $95 — roughly 25% above the current levels.
DocuSign (DOCU) is a company known for its eSignature solution that allows different parties to securely sign agreements without having to be in the same room.
Its remote business offerings have naturally come in handy over the pandemic-stricken years.
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On Jan. 31, 2020, it had 589,000 customers. By Oct. 31, 2022, it had 1.32 million customers worldwide.
Despite expanding its customer base, the company hasn’t been a market darling. Shares have tumbled by almost 50% over the past year.
Jefferies analyst Brent Thill has a ‘buy’ rating on DocuSign and a price target of $70 — about 20% higher than where the stock sits today.
Box (BOX) is a cloud-based content management, collaboration and file sharing service company.
Unlike the other two names on this list, Box is not as beaten-down as the other picks. Shares have only dropped 12% over the past 12 months.
Business is booming. In fiscal Q3, Box’s revenue grew 12% year over year to $250.0 million. Excluding the impact from exchange rate fluctuations, top line growth would have been 17%.
The company is also returning cash to investors through buybacks. In fiscal Q3, Box spent approximately $29 million repurchasing 1.1 million of its shares.
Morgan Stanley analyst Josh Baer sees better days ahead for Box. Baer has a ‘buy’ rating on the company and a price target of $39, implying a potential upside of over 40%.