Zoom Communications (ZM) closed at $92.58 in the latest trading session, marking a -3.78% move from the prior day. This move lagged the S&P 500's daily loss of 0.13%. Elsewhere, the Dow gained 0.11%, while the tech-heavy Nasdaq lost 0.72%.
Coming into today, shares of the video-conferencing company had gained 11.51% in the past month. In that same time, the Computer and Technology sector gained 1.88%, while the S&P 500 gained 0.78%.
Investors will be eagerly watching for the performance of Zoom Communications in its upcoming earnings disclosure. The company is predicted to post an EPS of $1.48, indicating a 4.96% growth compared to the equivalent quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $1.23 billion, reflecting a 4.08% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $5.96 per share and a revenue of $4.85 billion, demonstrating changes of +7.58% and +4%, respectively, from the preceding year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Zoom Communications. 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 business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. At present, Zoom Communications boasts a Zacks Rank of #2 (Buy).
In terms of valuation, Zoom Communications is presently being traded at a Forward P/E ratio of 16.14. This indicates a discount in contrast to its industry's Forward P/E of 23.25.
Investors should also note that ZM has a PEG ratio of 5.62 right now. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Internet - Software industry stood at 1.38 at the close of the market yesterday.
The Internet - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 80, placing it within the top 33% of over 250 industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Zoom Communications, Inc. (ZM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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