8x8 Stock: Analysts Raise Forecasts Following Strong Q3 Results

8x8 Inc. (NASDAQ:EGHT), a leading provider of cloud-based communication and contact center solutions, reported robust financial performance in its Q3 fiscal 2025, driving analysts to raise their forecasts for the company. The Campbell, California-based company reported net income of $3 million, or $0.02 per share, beating Wall Street expectations. Revenue came in at $178.9 million, slightly missing Street forecasts. However, the company's strong cash flow from operations and significant debt reduction have analysts optimistic about its future prospects.

Analysts have revised their price targets and ratings following the earnings release. Morgan Stanley raised its price target to $3.80 from $3.50, maintaining an 'Equalweight' rating. The firm cited 8x8's continued outperformance on cash flow as a key reason for the upward revision. Rosenblatt Securities also raised its price target to $4.50 from $4.00, maintaining a 'Buy' rating. The firm highlighted 8x8's strong customer satisfaction scores and growth in AI-based solutions as reasons for its optimism.

Mizuho Securities, however, downgraded the stock to 'Underperform' from 'Neutral', adjusting its price target to $2.75 from $3.00. The firm cited aggressive pricing in the UC space and the company's strategic investments as reasons for its cautious stance. B. Riley Securities cut its price target to $4 from $7, maintaining a 'Buy' rating. Wedbush Securities adjusted its price target to $4 from $7, maintaining a 'Neutral' rating. Both firms cited the company's revenue headwinds from Fuze customer upgrades as a reason for their downward revisions.

Despite the mixed analyst opinions, the average price target for 8x8 stock has increased to $3.135, reflecting a more optimistic outlook on the company's stock price. The average target predicts an increase of 18.30% from the current stock price of $2.650. The consensus rating from analysts is 'HOLD', indicating that analysts believe the stock is likely to perform in line with the market over the next twelve months.

8x8's strong Q3 results and positive outlook have analysts raising their forecasts for the company. The company's ability to generate record cash flow from operations and reduce debt by $33 million in the quarter and an additional $15 million in early January has impressed analysts. Additionally, the company's growth in AI-based solutions and expansion in the Asia Pacific region have contributed to analysts' optimism. However, the company still faces challenges, such as revenue headwinds from Fuze customer upgrades and foreign exchange headwinds. As such, analysts' opinions remain mixed, with some maintaining a bullish stance while others adopt a more cautious approach.

In conclusion, 8x8's strong Q3 results and positive outlook have analysts raising their forecasts for the company. While some analysts remain cautious due to the company's challenges, the overall outlook is positive, with analysts expecting the company to meet or slightly exceed its guidance for the upcoming quarters and fiscal year. Investors should closely monitor the company's progress and analysts' opinions to make informed decisions about their investments in 8x8 stock.