Zoom Video Communications (ZM) Gains As Market Dips: What You Should Know
Zoom Video Communications (ZM) closed at $64.45 in the latest trading session, marking a +0.03% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.17%. Meanwhile, the Dow lost 0.66%, and the Nasdaq, a tech-heavy index, lost 6.09%.
Prior to today's trading, shares of the video-conferencing company had lost 4.53% over the past month. This has lagged the Computer and Technology sector's gain of 2.08% and the S&P 500's gain of 0.75% in that time.
Investors will be hoping for strength from Zoom Video Communications as it approaches its next earnings release, which is expected to be May 22, 2023. In that report, analysts expect Zoom Video Communications to post earnings of $0.99 per share. This would mark a year-over-year decline of 3.88%. Our most recent consensus estimate is calling for quarterly revenue of $1.08 billion, up 0.91% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $4.20 per share and revenue of $4.44 billion, which would represent changes of -3.89% and +1.18%, respectively, from the prior year.
Any recent changes to analyst estimates for Zoom Video Communications should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Zoom Video Communications currently has a Zacks Rank of #2 (Buy).
In terms of valuation, Zoom Video Communications is currently trading at a Forward P/E ratio of 15.35. This valuation marks a discount compared to its industry's average Forward P/E of 40.86.
Meanwhile, ZM's PEG ratio is currently 0.61. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software industry currently had an average PEG ratio of 1.51 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 104, putting it in the top 42% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Zoom Video Communications, Inc. (ZM) : Free Stock Analysis Report
