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Zoom Video Communications (ZM) Stock Sinks As Market Gains: What You Should Know

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Zoom Video Communications (ZM - Free Report) closed at $76.11 in the latest trading session, marking a -1.08% move from the prior day. This change lagged the S&P 500's daily gain of 0.84%. At the same time, the Dow added 0.92%, and the tech-heavy Nasdaq gained 1.06%.

Heading into today, shares of the video-conferencing company had gained 13.82% over the past month, outpacing the Computer and Technology sector's gain of 6.54% and the S&P 500's gain of 3.95% in that time.

ZM will be looking to display strength as it nears its next earnings release.

Investors should also note any recent changes to analyst estimates for ZM. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ZM is currently sporting a Zacks Rank of #2 (Buy).

In terms of valuation, ZM is currently trading at a Forward P/E ratio of 284.01. Its industry sports an average Forward P/E of 56.99, so we one might conclude that ZM is trading at a premium comparatively.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 102, putting it in the top 40% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

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


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