Piper Sandler has revised its outlook on ZoomInfo (ZI, Financial), trimming the price target from $11 to $8 while maintaining a Neutral rating for the company's shares. This adjustment aligns with a broader recalibration across the cloud applications and analytics sector, as companies face increased obstacles to growth.
Several factors contribute to this cautious projection, including ongoing trade tariffs, evolving policy landscapes, and hurdles associated with the adoption of artificial intelligence. These challenges have significantly affected investor sentiment, leading to a moderation in industry growth for the fourth consecutive year. The adoption of AI, once a promising area for expansion, now appears to be encountering barriers that could hinder its previously anticipated growth trajectory.
Furthermore, Piper Sandler notes that valuation multiples within the sector have reached their lowest levels in seven years. Although the direct impact of tariffs on software models is considered minor, it remains a contributing factor to the current climate of uncertainty. These findings underscore the complexity and evolving nature of the sector's landscape.
