Ooma: Margin Expansion And EPS Growth Make The Risk Worth It
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Grassroots Trading2.49K FollowersFollow5ShareSavePlay(13min)CommentsSummaryOoma, Inc. offers discounted valuation and strong projected EPS growth, despite persistent underperformance versus the S&P 500.OOMA's business segment drives revenue growth and profitability, with ARPU up 4% and high-tier service adoption rising to 38%.Recent acquisitions (FluentStream, Phone.com) aim to accelerate growth, but integration and execution risks remain material.OOMA stock trades at a forward P/E of 11.9 and EV/Sales of 1.18, well below sector averages, supporting a buy rating despite competitive and integration headwinds. Funtap/iStock via Getty Images Thesis Ooma, Inc. (NYSE:OOMA) is an American company, just over 20 years in business that's based in Sunnyvale, California. It provides cloud-based voice and communications services, offerings that include VoIP phone systems aimed at home, business, and mobileThis article was written byGrassroots Trading2.49K FollowersFollowI focus on producing objective, data-driven research, mostly about small- to mid-cap companies, as these tend to be overlooked by many investors. From time to time, though, I also look at large-cap names, just to give a fuller sense of the broader equity markets.Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in OOMA over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.