Ooma (NYSE:OOMA) Stock Price Breaks Below 50 Day Moving Average - Here's Why

Key Points

• Ooma shares fell below their 50-day moving average, trading as low as $19.77 compared with the $21.53 average, amid a market capitalization of roughly $549 million.
• Despite the technical decline, analysts remain broadly positive: the stock has a consensus “Buy” rating and an average price target of $25, with recent targets ranging from $24 to $27.
• Ooma exceeded quarterly expectations, reporting $0.35 in EPS versus $0.33 expected and $83.23 million in revenue versus $81.72 million forecast. However, insiders sold 86,861 shares worth about $2.0 million over the past 90 days.

Shares of Ooma, Inc. (NYSE:OOMA - Get Free Report) passed below its 50 day moving average during trading on Wednesday. The stock has a 50 day moving average of $21.53 and traded as low as $19.77. Ooma shares last traded at $19.8990, with a volume of 333,803 shares trading hands.

Analyst Ratings Changes

Several research firms have recently issued reports on OOMA. Benchmark reissued a "buy" rating on shares of Ooma in a report on Monday, August 17th. UBS Group restated a "buy" rating on shares of Ooma in a research note on Thursday, August 27th. B. Riley Financial lifted their price target on Ooma from $24.00 to $27.00 and gave the company a "buy" rating in a research note on Thursday, August 27th. Lake Street Capital reaffirmed a "buy" rating and issued a $25.00 price objective on shares of Ooma in a research note on Thursday, August 27th. Finally, William Blair set a $24.00 price objective on shares of Ooma in a research note on Monday, August 17th. One equities research analyst has rated the stock with a Strong Buy rating, six have issued a Buy rating and one has given a Hold rating to the company. Based on data from MarketBeat, the stock presently has a consensus rating of "Buy" and an average price target of $25.00.

Ooma Stock Performance

The company has a debt-to-equity ratio of 0.46, a current ratio of 0.95 and a quick ratio of 0.66. The firm has a market capitalization of $549.21 million, a P/E ratio of 52.37 and a beta of 1.23. The stock has a fifty day simple moving average of $21.53 and a two-hundred day simple moving average of $19.24.

Ooma (NYSE:OOMA - Get Free Report) last announced its quarterly earnings data on Wednesday, August 26th. The technology company reported $0.35 EPS for the quarter, beating analysts' consensus estimates of $0.33 by $0.02. Ooma had a return on equity of 23.55% and a net margin of 3.57%. The firm had revenue of $83.23 million during the quarter, compared to analysts' expectations of $81.72 million. Ooma has set its FY 2027 guidance at 1.350-1.380 EPS and its Q3 2027 guidance at 0.340-0.350 EPS. On average, research analysts predict that Ooma, Inc. will post 0.87 EPS for the current year.

Insider Transactions at Ooma

In other news, CFO Shigeyuki Hamamatsu sold 4,807 shares of the company's stock in a transaction that occurred on Tuesday, September 1st. The stock was sold at an average price of $22.33, for a total value of $107,340.31. Following the completion of the transaction, the chief financial officer directly owned 179,420 shares of the company's stock, valued at $4,006,448.60. This represents a 2.61% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this hyperlink. Also, Director Susan Butenhoff sold 9,000 shares of the firm's stock in a transaction on Tuesday, September 22nd. The shares were sold at an average price of $22.02, for a total value of $198,180.00. Following the sale, the director directly owned 109,483 shares of the company's stock, valued at approximately $2,410,815.66. This represents a 7.60% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last 90 days, insiders have sold 86,861 shares of company stock worth $2,005,037. Company insiders own 9.90% of the company's stock.

Institutional Trading of Ooma

Several hedge funds and other institutional investors have recently modified their holdings of OOMA. BlackRock Inc. bought a new position in shares of Ooma during the second quarter valued at approximately $69,001,000. Hillsdale Investment Management Inc. purchased a new stake in Ooma during the 1st quarter valued at about $5,847,000. Globeflex Capital L P bought a new stake in Ooma during the 2nd quarter valued at about $4,235,000. Connor Clark & Lunn Investment Management Ltd. bought a new position in shares of Ooma in the second quarter worth approximately $3,746,000. Finally, AWM Investment Company Inc. bought a new position in Ooma in the 2nd quarter valued at approximately $3,341,000. Institutional investors own 80.42% of the company's stock.

About Ooma

Ooma, Inc is a cloud communications company that provides voice, collaboration, and related services to small and midsize businesses, enterprises, and consumers. Its business offerings are designed to replace or complement traditional business phone systems with internet-based communications delivered through software and connected devices.

Ooma's business products include Ooma Office, Ooma Pro, and Ooma Enterprise, which provide cloud-based phone systems, business texting, virtual extensions, conferencing, call management, and other unified communications features.

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