Benchmark reiterates Buy rating on Ooma stock, maintains $20 price target

Investing.com - Benchmark has reiterated its Buy rating on Ooma (NYSE:OOMA) stock, maintaining its $20.00 price target following the company’s earnings release. According to InvestingPro data, the stock currently trades at $12.24, suggesting significant upside potential. Seven analysts have recently revised their earnings expectations upward for the upcoming period.

The research firm cited Ooma’s ability to convert steady top-line expansion into record profitability while simultaneously generating compounding cash flow and funding targeted innovation. The company’s revenue grew 7.01% year-over-year, maintaining a healthy gross margin of 60.96% and generating $20.5M in free cash flow. InvestingPro analysis indicates the stock is currently undervalued, with additional insights available in the comprehensive Pro Research Report.

Benchmark identified three key growth vectors for Ooma: scale and mix shift within Business subscriptions, accelerating momentum in the AirDial POTS-replacement market, and progressive enhancement of the 2600Hz wholesale platform with Ooma IP and AI features.

The firm’s maintained rating and price target came after what it described as an "encouraging" earnings release from Ooma on Tuesday.

Ooma continues to strengthen its position in the business communications market through its multi-pronged growth strategy, according to Benchmark’s assessment.

In other recent news, Ooma Inc reported its second-quarter fiscal 2026 results, which slightly exceeded analyst expectations. The company announced non-GAAP earnings per share of $0.22, surpassing the consensus estimate of $0.20. Additionally, Ooma’s adjusted EBITDA reached $7.2 million, aligning with analyst projections. In a separate earnings call, Ooma reported its Q2 2025 earnings, also beating expectations with an EPS of $0.23 compared to the anticipated $0.20. The revenue for this period was $66.4 million, slightly above the forecasted $65.72 million. JMP Securities maintained its Market Perform rating on Ooma stock following these results. These recent developments highlight Ooma’s ability to deliver financial outcomes that meet or exceed market expectations.

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