How ZoomInfo’s Recent Returns Frame the Valuation Question

ZoomInfo Technologies has caught the eye of investors who are wondering whether the current share price fairly reflects the business, or if the stock might be mispriced.

Over the last week the share price shows a 1.3% decline, while the 30 day return sits at 7.2%. Looking over a longer stretch, returns are 36.2% lower year to date and 30.3% lower over the last year, with 3 and 5 year returns 72.0% and 88.2% lower respectively.

These moves have played out alongside ongoing interest in the company’s position in the sales and marketing data space and continued investor attention on profitability, customer retention and growth efficiency. Together, those themes have shaped how the market reacts to ZoomInfo’s updates and help explain some of the recent share price swings.

On Simply Wall St’s valuation checks, ZoomInfo scores 5 out of 6 for being assessed as undervalued. The rest of this article will compare different valuation approaches before circling back to an even more complete way to think about what the stock could be worth.

Approach 1: ZoomInfo Technologies Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model takes projected future cash flows and discounts them back into today’s dollars to estimate what the business might be worth at present.

For ZoomInfo Technologies, Simply Wall St uses a 2 Stage Free Cash Flow to Equity model. The latest twelve month Free Cash Flow stands at about $408.9 million. Analyst and extrapolated projections indicate Free Cash Flow of $412.8 million in 2026 and around $392.0 million by 2030, with additional estimates extending out to 2035. All figures are expressed in dollars and then discounted back to today’s value.

Adding these discounted cash flows together gives an estimated intrinsic value of about $15.45 per share. Compared with the current share price, this implies a 60.3% discount. Under these specific cash flow assumptions and discount rates, the DCF output suggests the stock is materially undervalued.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests ZoomInfo Technologies is undervalued by 60.3%. Track this in your watchlist or portfolio, or discover 54 more high quality undervalued stocks.

Approach 2: ZoomInfo Technologies Price vs Earnings

For a profitable company, the P/E ratio is a useful shorthand for how much investors are willing to pay today for each dollar of current earnings. It links the share price directly to the underlying earnings power of the business, which is often the primary driver of long term returns.

What counts as a “normal” or “fair” P/E usually reflects the balance between growth expectations and risk. Higher expected earnings growth or more resilient earnings can support a higher P/E, while more uncertainty or weaker profitability can justify a lower multiple.

ZoomInfo currently trades on a P/E of 14.71x. This sits below the Interactive Media and Services industry average of 16.59x and also below the peer average of 15.84x. Simply Wall St’s Fair Ratio for ZoomInfo is 17.80x, which is its proprietary estimate of an appropriate P/E given factors such as earnings growth, industry, profit margin, market cap and risk profile.

The Fair Ratio can be more informative than a simple peer or industry comparison because it adjusts for company specific characteristics rather than assuming all firms deserve similar multiples. With a Fair Ratio of 17.80x versus the current 14.71x P/E, this framework points to the shares trading below that fair multiple.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your ZoomInfo Technologies Narrative

Earlier it was mentioned that there is an even better way to understand valuation. Narratives bring this to life by letting you attach a clear story about ZoomInfo Technologies to the numbers you see, linking your view of its business drivers to a forecast for revenue, earnings and margins, and then to a fair value that can be compared with the current share price.

On Simply Wall St’s Community page, Narratives are available as an easy to use tool, used by millions of investors. You can see different fair value estimates side by side and how they connect back to specific assumptions about ZoomInfo’s customer mix, AI products like Copilot, data regulation risk, profitability and required P/E multiples.

For ZoomInfo Technologies, one bullish Narrative currently lines up with a fair value of about US$14.19. Another more cautious Narrative works with a fair value around US$8.00, and the Analyst Consensus Narrative sits near US$9.16. You can choose which story best matches your expectations and then watch it update as new earnings, guidance, index changes or buyback news are incorporated into the forecasts automatically.

Do you think there's more to the story for ZoomInfo Technologies? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.