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Zoom Video Communications (ZM) Dips More Than Broader Markets: What You Should Know

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Zoom Video Communications (ZM - Free Report) closed at $310.46 in the latest trading session, marking a -0.77% move from the prior day. This change lagged the S&P 500's 0.29% loss on the day.

Prior to today's trading, shares of the video-conferencing company had lost 2.77% over the past month. This has was narrower than the Computer and Technology sector's loss of 5.62% and lagged the S&P 500's loss of 1.27% in that time.

Wall Street will be looking for positivity from ZM as it approaches its next earnings report date. This is expected to be June 1, 2021. In that report, analysts expect ZM to post earnings of $0.97 per share. This would mark year-over-year growth of 385%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $905.24 million, up 175.84% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.67 per share and revenue of $3.8 billion. These totals would mark changes of +9.88% and +43.28%, respectively, from last year.

Any recent changes to analyst estimates for ZM should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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 has moved 0.33% higher. ZM is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that ZM has a Forward P/E ratio of 85.33 right now. This represents a premium compared to its industry's average Forward P/E of 64.04.

It is also worth noting that ZM currently has a PEG ratio of 5.89. 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. ZM's industry had an average PEG ratio of 3.28 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 190, which puts it in the bottom 26% 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.

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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