RBC Capital lowered shares of ZoomInfo Technologies Inc. (ZI) to Underperform with a new price target of $14, down from $16 per share, and lifted Fastly, Inc. (NYSE:FSLY) to Sector Perform, with a new price target of $18, up from $12 per share in separate notes to clients on Monday.
Analysts said that with ZoomInfo shares up 50% off the November lows, they think the stock has gotten ahead of itself.
"Our downgrade is based on four key points, including: 1) competition is tough and may get even tougher; 2) longer-term genAI concerns; 3) potential margin pressure; and 4) macro pressures persisting," they explained.
Overall, RBC Capital views the shares as showing an unfavorable risk/reward.
Meanwhile, the Fastly upgrade is based on four key points: "1) solid execution under new CEO Todd Nightingale; 2) an improving competitive environment; 3) the business continues to diversify; and 4) edge computing is gaining acceptance."
RBC Capital believes FSLY's shares are now fairly valued.