Zendesk provides software as a service customer service platform for organizations. It provides single customer service interface to organizations to manage all their one-on-one customer interactions, track and predict common questions, and provide a seamless path to answers. The company was founded in 2007 and is based in San Francisco, California.
ZEN Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for ZEN, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Zendesk Inc ranked in the 8th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. The most interesting components of our discounted cash flow analysis for Zendesk Inc ended up being:
Zendesk Inc's interest coverage rate -- a measure of gross earnings relative to interest payments -- comes in at -5.11. This coverage rate is greater than that of only 9.94% of stocks we're observing for the purpose of forecasting via discounted cash flows.
As a business, Zendesk Inc experienced a tax rate of about 0% over the past twelve months; relative to its sector (Technology), this tax rate is higher than just 0% of stocks generating free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Technology that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as ZEN, try MFCO, MRVL, NSIT, SONO, and AYX.
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Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors' consensus returns have been exceptional. In the following paragraphs, we find out […]