Key Stats for RNG Stock
- Price Change for RNG stock: +34.4%
- RNG Share Price as of Feb. 20: $39.50
- 52-Week High: $40.64
- RNG Stock Price Target: $33.27
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What Happened?
RingCentral (RNG) stock surged over 34% on February 20 after the company reported Q4 2025 results that beat expectations and announced its first-ever quarterly dividend.
The cloud communications provider posted Q4 revenue of about $644 million, up roughly 5% year over year. Non-GAAP earnings per share came in around $1.18, beating estimates and rising more than 20% from the prior year.
But the real catalyst was the company’s optimistic 2026 outlook. Management guided for full-year 2026 non-GAAP EPS of roughly $4.87 at the midpoint, which came in above consensus expectations. RingCentral also guided for 4% to 5% revenue growth and a non-GAAP operating margin between 23% and 23.5%.
The company initiated a quarterly dividend of $0.075 per share and expanded its share repurchase authorization to $500 million. In Q4 alone, RingCentral bought back about $135 million worth of shares.
For the full year 2025, the company generated roughly $617 million in operating cash flow, up 28% year over year, and about $530 million in free cash flow, up 32%. Management also targets roughly $590 million in free cash flow for 2026.
Adding to the momentum, RingCentral was added to the S&P SmallCap 600 index in February, replacing Hillenbrand. Index inclusion typically drives additional demand from passive funds and benchmark-aware investors.
The company also recently announced a partnership with OpenAI to advance enterprise voice AI, and AI-related annual recurring revenue has more than doubled year over year, now representing nearly 10% of total ARR.
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What the Market Is Telling Us About RNG Stock
The 34% surge pushed RNG to a new 52-week high of $40.64. The stock is now up about 36.8% year to date from its $28.88 close at the end of 2025.
However, RNG stock now trades above the mean analyst target of $33.27 based on the latest 15 estimates. Among 16 analysts covering the stock, 4 rate it a Buy, 3 rate it Outperform, and 9 rate it Hold. The median target sits at $32, while the high target is $45 and the low target is $28.
At the current price near $40, RNG trades at an NTM P/E of about 8.2x and an NTM EV/EBITDA of roughly 6.7x. The NTM free cash flow yield is attractive, with the market cap running at about 5.9x forward free cash flow. These are low multiples for a software company with 71.4% gross margins and improving profitability.
RingCentral turned GAAP profitable in fiscal 2025, posting net income of about $43 million compared with a net loss the prior year. EBITDA grew roughly 55% to $366 million. The operating margin improved from around 1% to about 5.7% on a GAAP basis as the company scaled and controlled operating expenses.
The new dividend and expanded buyback program signal that management views RingCentral as a durable cash-generating business that can return capital to shareholders while still investing in AI, product development, and go-to-market initiatives. The 0.8% dividend yield is modest, but the combined shareholder return through buybacks and dividends adds to the stock’s total return profile.
Still, risks remain. Revenue growth is slowing compared with prior years, and the company must manage sizable near-term debt maturities in a still-uncertain rate environment. The stock now trades above its consensus target price, so further upside likely depends on continued execution, sustained cash flow growth, and potential upward revisions to analyst estimates.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
