U.S. Markets closed

Zoom Video Communications (ZM) Gains But Lags Market: What You Should Know

Zacks Equity Research

Zoom Video Communications (ZM) closed at $93.17 in the latest trading session, marking a +0.69% move from the prior day. This change lagged the S&P 500's 1.21% gain on the day. At the same time, the Dow added 0.97%, and the tech-heavy Nasdaq gained 1.35%.

Heading into today, shares of the video-conferencing company had lost 2.79% over the past month, outpacing the Computer and Technology sector's loss of 3.41% and the S&P 500's loss of 3.6% in that time.

Investors will be hoping for strength from ZM as it approaches its next earnings release, which is expected to be September 5, 2019.

Any recent changes to analyst estimates for ZM should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. ZM is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note ZM's current valuation metrics, including its Forward P/E ratio of 5140.56. This represents a premium compared to its industry's average Forward P/E of 52.06.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 78, which puts it in the top 31% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Zoom Video Communications, Inc. (ZM) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research