Zoom Video Communications (ZM) is seeing continued traction with its contact center as a service and AI products, Morgan Stanley said in a research note Thursday.

The investment firm lifted Zoom's estimates as a "price increase on online business more than offset some macro uncertainty with enterprise customers (in addition to FX impact)."

However, the "catalyst for rerating remains reacceleration" which the company's Q1 results didn't bring, the note said.

Morgan Stanley said Zoom's fiscal Q1 EPS beat of 12% was mainly due to "larger than expected share repurchases and opex savings."

Morgan Stanley kept its equal-weight rating on Zoom and raised the price target to $85 from $79.

The equal-weight rating on Zoom "has been a result of uncertainty in how much company can prove out reacceleration they (and investors) have been focused on," the note said.

Price: 79.99, Change: -2.28, Percent Change: -2.77