This analyst predicts that Five9 shares could rise by 165% in 2026

Analyst Perspectives on Five9 (FIVN)

Wall Street analysts hold a range of views on Five9, with some expressing strong confidence in the company's future. At the optimistic end, Northland Capital Markets has set a top price target of approximately $47, which is significantly higher than current levels. This projection implies a potential increase of 164.9% from the previous day's closing price, and Northland has issued a “Strong Buy” recommendation for the stock.

Related Stories from Barchart

Recent Stock Performance

Five9 shares have experienced a notable rally, rising by roughly 13.8% over the past week. The company recently reported earnings that surpassed expectations and provided positive guidance, alleviating concerns that artificial intelligence might disrupt its business model. Management highlighted that enterprise AI bookings more than doubled year-over-year, increasing the backlog, and the company’s AI offerings now generate $100 million in annual recurring revenue.

Company Overview

Five9 specializes in cloud-based contact center solutions, enabling organizations to manage customer communications across various channels such as voice, chat, and email. Its main product, the Virtual Contact Center platform, is designed to replace traditional on-premise systems with scalable, secure, and AI-driven software for customer service, sales, and support teams.

Based in San Ramon, California, Five9 serves a wide range of clients—from large enterprises to small businesses—offering tools for omnichannel engagement, workforce management, and analytics. The company’s current market capitalization stands at around $1.4 billion.

Stock Volatility and Trends

Over the past year, Five9’s share price has been highly volatile. The stock reached a 52-week high of $42.66 in February 2025, but has since dropped 58.4% to close the most recent session at $17.74. This decline reflects ongoing challenges in the sector and changing investor sentiment, with the stock down 57.9% year-over-year.

Year-to-date, Five9 has also faced headwinds, with shares still down about 11.5% as they attempt to recover from earlier lows. Although the recent earnings report and guidance sparked a short-term price increase, the gains were not sustained, and the stock fell 8.2% during intraday trading on February 23.

Valuation Snapshot

Currently, Five9 trades at 14.2 times forward earnings, which is below the median for its sector.

Quarterly and Annual Financial Highlights

Five9’s financial results for the fourth quarter and full year 2025, released on February 19, show signs of growth and improved profitability after a period of transition. In Q4, the company achieved record revenue of $300.3 million, an 8% increase from the previous year, with subscription revenue—its main recurring stream—growing by 12%. Enterprise AI revenue, a strategic focus, expanded by about 50% year-over-year, and bookings more than doubled, boosting the backlog.

On the profitability front, Five9 reported adjusted earnings per share of $0.80, exceeding expectations and up from $0.79 a year earlier. The adjusted EBITDA margin also improved to 26% year-over-year.

For the full year 2025, revenue climbed 10% to approximately $1.2 billion. After years of losses, Five9 posted a positive net income of about $39.4 million, marking a turnaround in profitability. Non-GAAP earnings reached $2.96, up from $2.47 in the prior year.

Looking ahead, management projects fiscal 2026 revenue between $1.25 billion and $1.26 billion, with non-GAAP EPS expected to range from $3.15 to $3.21.

Analysts are generally positive, forecasting fiscal 2026 EPS of around $1.22—a 23.2% increase year-over-year—and projecting a further 26.2% rise to $1.54 in 2027.

Analyst Ratings and Price Targets

Despite a high price target from some analysts, others have recently reduced their targets for Five9. For example, RBC Capital lowered its target to $25 from $35 but kept an “Outperform” rating, citing strong fourth-quarter results and growing AI adoption. Similarly, Cantor Fitzgerald cut its target to $26 from $32 due to lower sector valuations, yet maintained an “Overweight” rating after Five9’s robust Q4 performance.

Overall, the consensus rating for Five9 is “Moderate Buy.” Out of 22 analysts, 13 recommend a “Strong Buy,” two suggest a “Moderate Buy,” and seven rate the stock as “Hold.” The average analyst price target of $28.25 indicates a potential upside of 59.2% from current levels.

Disclosure

At the time of publication, Subhasree Kar did not hold any positions in the securities discussed. This article was originally published on Barchart.com.