Zoom Video Communications (ZM) Beats Stock Market Upswing: What Investors Need to Know
Zoom Video Communications (ZM) ended the recent trading session at $69.59, demonstrating a +0.8% swing from the preceding day's closing price. The stock outpaced the S&P 500's daily gain of 0.22%. Meanwhile, the Dow experienced a rise of 0.36%, and the technology-dominated Nasdaq saw an increase of 0.32%.
The the stock of video-conferencing company has fallen by 4.77% in the past month, lagging the Computer and Technology sector's gain of 3.64% and the S&P 500's gain of 1.61%.
The upcoming earnings release of Zoom Video Communications will be of great interest to investors. In that report, analysts expect Zoom Video Communications to post earnings of $1.15 per share. This would mark a year-over-year decline of 5.74%. Our most recent consensus estimate is calling for quarterly revenue of $1.13 billion, up 0.97% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $4.94 per share and revenue of $4.51 billion, indicating changes of +13.04% and +2.6%, respectively, compared to the previous year.
Any recent changes to analyst estimates for Zoom Video Communications should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Zoom Video Communications is currently sporting a Zacks Rank of #1 (Strong Buy).
In terms of valuation, Zoom Video Communications is presently being traded at a Forward P/E ratio of 13.98. This expresses a discount compared to the average Forward P/E of 34.11 of its industry.
Investors should also note that ZM has a PEG ratio of 0.42 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Internet - Software industry stood at 1.76 at the close of the market yesterday.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 58, finds itself in the top 24% echelons of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Zoom Video Communications, Inc. (ZM) : Free Stock Analysis Report
