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On Thursday, Citizens JMP analyst Patrick Walravens maintained a positive outlook on Bandwidth Inc. (NASDAQ:BAND) by reiterating a Market Outperform rating and a $36.00 price target. The target represents significant upside potential from the current price of $14.58. According to InvestingPro data, four analysts have recently revised their earnings estimates upward for the upcoming period. Walravens highlighted several factors that contribute to the attractiveness of Bandwidth as an investment opportunity.
Firstly, the company’s enterprise voice and global voice plans are expected to see growth acceleration driven by the increasing adoption of voice AI agents. This aligns with the company’s impressive revenue growth of 18.51% over the last twelve months. Walravens also noted the company’s rapid pace of innovation, which could potentially lead to Bandwidth offering its own voice agents in the future.
Furthermore, Bandwidth is targeting a total addressable market (TAM) that was valued at $18 billion in 2024 and is projected to grow to $28 billion by 2028. The analyst expressed confidence in the company’s leadership, specifically citing Mr. Morken, Mr. Raiford, Mr. Bell, and Mr. Agarwal for their capable guidance. The company maintains a healthy liquidity position with a current ratio of 1.31, indicating strong short-term financial stability.For deeper insights into Bandwidth’s financial health and growth potential, InvestingPro subscribers have access to over 30 additional financial metrics and exclusive analysis.
Lastly, Walravens pointed out that Bandwidth’s current market valuation is seen as attractive for acquisition, trading at a depressed valuation of 0.7 times its estimated 2026 enterprise value/revenue and five times its estimated 2026 enterprise value/free cash flow.
The endorsement from Citizens JMP suggests a strong belief in Bandwidth’s potential for capital appreciation, backed by the company’s strategic positioning and leadership in the market.
In other recent news, Bandwidth Inc. reported impressive first-quarter 2025 earnings, with a non-GAAP EPS of $0.36, surpassing the consensus estimate of $0.27. The company’s revenue reached $174 million, exceeding forecasts of $169 million, marking a 2% year-over-year increase. JMP Securities maintained a Market Outperform rating for Bandwidth, reflecting confidence in the company’s performance despite mixed results in cash flow. Needham initiated coverage on Bandwidth with a Buy rating and a $20 price target, citing the company’s strong free cash flow and EBITDA margins. Meanwhile, Citi analyst Tyler Radke adjusted the price target for Zoom Video Communications (NASDAQ:ZM) to $84 from $85, maintaining a Neutral rating. Radke noted Zoom’s margins have peaked, and the company faces limited growth catalysts. Despite these challenges, Zoom’s lower reliance on large deals and government contracts may buffer it against macroeconomic impacts. These developments highlight the varied performance and expectations for these companies in the communications technology sector.
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