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Zoom Communications (ZM) Stock Sinks As Market Gains: Here's Why
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In the latest trading session, Zoom Communications (ZM - Free Report) closed at $105.14, marking a -3.63% move from the previous day. The stock fell short of the S&P 500, which registered a gain of 1.46% for the day. At the same time, the Dow added 1.24%, and the tech-heavy Nasdaq gained 2.03%.
Shares of the video-conferencing company have appreciated by 29.85% over the course of the past month, outperforming the Computer and Technology sector's gain of 19.39%, and the S&P 500's gain of 10.32%.
The investment community will be paying close attention to the earnings performance of Zoom Communications in its upcoming release. The company is slated to reveal its earnings on May 21, 2026. On that day, Zoom Communications is projected to report earnings of $1.41 per share, which would represent a year-over-year decline of 1.4%. At the same time, our most recent consensus estimate is projecting a revenue of $1.22 billion, reflecting a 4.16% rise from the equivalent quarter last year.
ZM's full-year Zacks Consensus Estimates are calling for earnings of $5.87 per share and revenue of $5.06 billion. These results would represent year-over-year changes of -0.84% and +3.92%, respectively.
Investors should also note any recent changes to analyst estimates for Zoom Communications. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Zoom Communications currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Zoom Communications is holding a Forward P/E ratio of 18.59. This represents a discount compared to its industry average Forward P/E of 19.67.
Meanwhile, ZM's PEG ratio is currently 4.19. 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. As the market closed yesterday, the Internet - Software industry was having an average PEG ratio of 1.13.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 85, which puts it in the top 35% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Zoom Communications (ZM) Stock Sinks As Market Gains: Here's Why
In the latest trading session, Zoom Communications (ZM - Free Report) closed at $105.14, marking a -3.63% move from the previous day. The stock fell short of the S&P 500, which registered a gain of 1.46% for the day. At the same time, the Dow added 1.24%, and the tech-heavy Nasdaq gained 2.03%.
Shares of the video-conferencing company have appreciated by 29.85% over the course of the past month, outperforming the Computer and Technology sector's gain of 19.39%, and the S&P 500's gain of 10.32%.
The investment community will be paying close attention to the earnings performance of Zoom Communications in its upcoming release. The company is slated to reveal its earnings on May 21, 2026. On that day, Zoom Communications is projected to report earnings of $1.41 per share, which would represent a year-over-year decline of 1.4%. At the same time, our most recent consensus estimate is projecting a revenue of $1.22 billion, reflecting a 4.16% rise from the equivalent quarter last year.
ZM's full-year Zacks Consensus Estimates are calling for earnings of $5.87 per share and revenue of $5.06 billion. These results would represent year-over-year changes of -0.84% and +3.92%, respectively.
Investors should also note any recent changes to analyst estimates for Zoom Communications. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Zoom Communications currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Zoom Communications is holding a Forward P/E ratio of 18.59. This represents a discount compared to its industry average Forward P/E of 19.67.
Meanwhile, ZM's PEG ratio is currently 4.19. 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. As the market closed yesterday, the Internet - Software industry was having an average PEG ratio of 1.13.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 85, which puts it in the top 35% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.