Five9, Inc. (FIVN): A Bull Case Theory

We came across a bullish thesis on Five9, Inc. on Show me the incentives...’s Substack. In this article, we will summarize the bulls’ thesis on FIVN. Five9, Inc.'s share was trading at $17.79 as of January 29th. FIVN’s trailing and forward P/E were 46.84 and 5.58, respectively according to Yahoo Finance.

Five9 is a structurally sound cloud contact-center software company trading at distressed valuations despite signs that its fundamentals are stabilizing and inflecting. With an enterprise value of roughly $1.7 billion, the stock trades at about 1.5x forward sales and a modest multiple of adjusted EBITDA, even as GAAP profitability has turned positive, stock-based compensation is declining, and share buybacks have begun. Growth has decelerated sharply from pandemic-era highs, fueling the bear case around AI disruption, seat-based pricing pressure, and competitive saturation, but bulls argue this slowdown marks a trough rather than a terminal decline.

Five9’s AI-enabled Intelligent CX platform is deeply embedded across more than 3,000 enterprise customers, supporting omnichannel interactions at scale and benefiting from long-term CCaaS market growth, a shift toward consumption-based pricing, and decades of proprietary data. Capital allocation has been disciplined, with low-cost convert debt largely offset by a substantial cash balance, an active buyback program, and a history of value-accretive tuck-in M&A that has strengthened analytics, automation, and orchestration capabilities.

Activist involvement from Pictet, Anson, Legion, and Voss has intensified pressure on governance and strategy, coinciding with the quiet dismantling of takeover defenses, board refreshment, workforce reductions, and tighter compensation controls. The retirement of the long-tenured CEO and the appointment of a new CEO with strong AI credentials and explicit sales experience further reinforce the perception of a company increasingly aligned with shareholder value creation. Together, these factors make Five9 appear less like a broken growth story and more like a pre-deal asset positioned for a rerating or potential acquisition as growth reaccelerates and strategic optionality crystallizes.

Previously, we covered a bullish thesis on NICE Ltd. (NICE) by Relevations in January 2025, which highlighted the company’s leadership in AI-driven CX software, CCaS dominance, and long-term generative AI monetization. NICE’s stock price has depreciated by approximately 34.33% since our coverage due to CEO transition concerns. "Show me the incentives…" shares a similar view but emphasizes governance reform, activist involvement, and M&A optionality at Five9.

Five9, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 36 hedge fund portfolios held FIVN at the end of the third quarter which was 40 in the previous quarter. While we acknowledge the risk and potential of FIVN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than FIVN and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.