We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Tech Stocks for 2025: Buy FIVN Down 80% for AI-Boost Upside?
Read MoreHide Full Article
Five9, Inc. (FIVN - Free Report) stock has tanked 80% from its summer 2021 peaks, driven by rising interest rates that saw Wall Street dump stocks trade at massive premiums to future earnings. Five9 shareholders also rejected Zoom’s attempted deal to buy the firm in September 2021.
Five9 stock remained on a downward trajectory until this fall. The provider of cloud software for contact centers has soared 40% since early November, fueled by its solid beat-and-raise quarter.
Five9’s artificial intelligence-boosted features are driving results, and its recent upward earnings revisions land it a Zacks Rank #1 (Strong Buy).
FIVN has crushed the Zacks Tech sector over the last 10 years, up 845% vs. 340%, even though it trades 80% below its all-time highs. Therefore, investors looking for tech stocks with big upside might want to buy Five9 stock in 2025.
Why Five9 Stock Could Be a 2025 Tech Winner
Five9 was at the vanguard of cloud software solutions for contact centers. Five9’s easy-to-use applications help its clients improve customer interactions across voice, chat, email, web, social media, and mobile. Five9’s goal is to help transform contact centers for the modern world where customers expect a streamlined, customized experience across every possible communication platform around the clock.
Five9 has adapted to the AI arms race, rolling out its Intelligent CX Platform. Five9’s AI-enhanced offerings enable its clients to “deliver AI-driven, hyper-personalized, seamless experiences at every stage of the customer journey.”
Image Source: Zacks Investment Research
Five9 aims to empower customer service agents to take care of whatever the customer needs as efficiently as possible, while also becoming more proactive and personalized.
FIVN grew its subscription revenue by 20% in Q3, with total revenue up 15%. Five9 posted an adjusted EBITDA margin of 20%, helping it produce an operating cash flow of $41 million.
Five9 raised its outlook when it reported on November 7, with its positive EPS revisions earning it a Zacks Rank #1 (Strong Buy). “We are energized by the momentum we are seeing with our AI products and believe that the market opportunity ahead is stronger than ever,” CEO Mike Burkland said in prepared remarks.
Image Source: Zacks Investment Research
Five9 is projected to grow its adjusted earnings by 15% in 2024 and 8% next year. FIVN has beaten our bottom-line estimates by an average of 22% in the trailing four quarters. The customer service tech firm is expected to grow its sales by 13% and 10.5%, respectively to reach $1.14 billion in 2025—up from $435 million in 2020.
Is Five9 Stock Set to Soar in 2025?
FIVN stock has soared 845% in the 10 years to blow away the Zacks Tech sector’s 340%. Yet the stock is down 35% in the last five years. Five9 stock trades 80% below its August 2021 peak, which it reached shortly after Zoom (ZM - Free Report) announced it was set to acquire FIVN in an all-stock transaction valuing Five9 at $14.7 billion.
Fast forward a few months to September 2021 and the companies terminated the deal by mutual agreement after it failed to receive the requisite number of votes from Five9 shareholders. Five9’s current market cap sits at $3.2 billion with the stock down 45% in 2024.
Image Source: Zacks Investment Research
FIVN is flashing signs of life, having surged 50% in the past three months and 35% since its Q3 release in early November.
Five9 trades 19% below its average Zacks price target and it’s attempting to retake its 50-week moving average.
Image Source: Zacks Investment Research
FIVN trades at 2.9X forward 12-month sales, marking a 55% discount to Tech and 50% value vs. its 10-year median. Five9’s forward earnings multiple remains sky-high and is a big part of the reason for its tumble and massive underperformance over the last several years.
If Five9 can slowly improve its bottom line through its AI efforts then it could be a long-term winner.
Wall Street might start nibbling at the stock even at its valuation levels. Plus, 12 of the 19 brokerage recommendations Zacks has for the cloud contact center software stock are “Strong Buys,” alongside two “Buys” and zero sells.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Tech Stocks for 2025: Buy FIVN Down 80% for AI-Boost Upside?
Five9, Inc. (FIVN - Free Report) stock has tanked 80% from its summer 2021 peaks, driven by rising interest rates that saw Wall Street dump stocks trade at massive premiums to future earnings. Five9 shareholders also rejected Zoom’s attempted deal to buy the firm in September 2021.
Five9 stock remained on a downward trajectory until this fall. The provider of cloud software for contact centers has soared 40% since early November, fueled by its solid beat-and-raise quarter.
Five9’s artificial intelligence-boosted features are driving results, and its recent upward earnings revisions land it a Zacks Rank #1 (Strong Buy).
FIVN has crushed the Zacks Tech sector over the last 10 years, up 845% vs. 340%, even though it trades 80% below its all-time highs. Therefore, investors looking for tech stocks with big upside might want to buy Five9 stock in 2025.
Why Five9 Stock Could Be a 2025 Tech Winner
Five9 was at the vanguard of cloud software solutions for contact centers. Five9’s easy-to-use applications help its clients improve customer interactions across voice, chat, email, web, social media, and mobile. Five9’s goal is to help transform contact centers for the modern world where customers expect a streamlined, customized experience across every possible communication platform around the clock.
Five9 has adapted to the AI arms race, rolling out its Intelligent CX Platform. Five9’s AI-enhanced offerings enable its clients to “deliver AI-driven, hyper-personalized, seamless experiences at every stage of the customer journey.”
Image Source: Zacks Investment Research
Five9 aims to empower customer service agents to take care of whatever the customer needs as efficiently as possible, while also becoming more proactive and personalized.
FIVN grew its subscription revenue by 20% in Q3, with total revenue up 15%. Five9 posted an adjusted EBITDA margin of 20%, helping it produce an operating cash flow of $41 million.
Five9 raised its outlook when it reported on November 7, with its positive EPS revisions earning it a Zacks Rank #1 (Strong Buy). “We are energized by the momentum we are seeing with our AI products and believe that the market opportunity ahead is stronger than ever,” CEO Mike Burkland said in prepared remarks.
Image Source: Zacks Investment Research
Five9 is projected to grow its adjusted earnings by 15% in 2024 and 8% next year. FIVN has beaten our bottom-line estimates by an average of 22% in the trailing four quarters. The customer service tech firm is expected to grow its sales by 13% and 10.5%, respectively to reach $1.14 billion in 2025—up from $435 million in 2020.
Is Five9 Stock Set to Soar in 2025?
FIVN stock has soared 845% in the 10 years to blow away the Zacks Tech sector’s 340%. Yet the stock is down 35% in the last five years. Five9 stock trades 80% below its August 2021 peak, which it reached shortly after Zoom (ZM - Free Report) announced it was set to acquire FIVN in an all-stock transaction valuing Five9 at $14.7 billion.
Fast forward a few months to September 2021 and the companies terminated the deal by mutual agreement after it failed to receive the requisite number of votes from Five9 shareholders. Five9’s current market cap sits at $3.2 billion with the stock down 45% in 2024.
Image Source: Zacks Investment Research
FIVN is flashing signs of life, having surged 50% in the past three months and 35% since its Q3 release in early November.
Five9 trades 19% below its average Zacks price target and it’s attempting to retake its 50-week moving average.
Image Source: Zacks Investment Research
FIVN trades at 2.9X forward 12-month sales, marking a 55% discount to Tech and 50% value vs. its 10-year median. Five9’s forward earnings multiple remains sky-high and is a big part of the reason for its tumble and massive underperformance over the last several years.
If Five9 can slowly improve its bottom line through its AI efforts then it could be a long-term winner.
Wall Street might start nibbling at the stock even at its valuation levels. Plus, 12 of the 19 brokerage recommendations Zacks has for the cloud contact center software stock are “Strong Buys,” alongside two “Buys” and zero sells.