The investment firm says the customers of the Vancouver, Wash., cloud-based data platform for sales-and-marketing applications will see "tangible" return on investment through increased productivity and revenue.
"ZoomInfo in our view offers a combination of a proven business model from both a profitability perspective at a relatively early stage of the company’s life and with a sustainable high revenue growth rate for multiple years, resulting over time in a multibillion revenue business," analyst Kash Rangan said.
Goldman says ZoomInfo is in the early stages of addressing a potential $20 billion market with a less than 2% market share. The company is also expanding the total addressable market in adjacent areas, according to Monday's note.
ZoomInfo has the opportunity to expand outside digital selling to areas, such as human-resources recruiting, with economic units well above those of the average software-as-a-service company.
"We believe that ZoomInfo is well positioned to capitalize on the accelerating trend of digital transformation as companies increasingly shift to digital selling due to COVID," Rangan wrote.
"With operating margins already at 40%-plus due to efficient [research-and-development and sales-and-marketing engines], the focus is on sustainability of the revenue-growth rate," Rangan said.
Goldman says the market is very underpenetrated, giving ZoomInfo to potentially become a multibillion-revenue business.
ZoomInfo shares at last check were up 4.4% at $51. Through Friday's close, the shares were trading about halfway between their 52-week low of $30.83, set in mid-September, and 52-week high of $64.40, set in early June.