In the latest trading session, Zoom Communications (ZM) closed at $88.53, marking a -4.4% move from the previous day. This move lagged the S&P 500's daily gain of 0.1%. On the other hand, the Dow registered a gain of 0.07%, and the technology-centric Nasdaq increased by 0.14%.
Shares of the video-conferencing company witnessed a gain of 14.38% over the previous month, beating the performance of the Computer and Technology sector with its loss of 4.05%, and the S&P 500's loss of 1.43%.
Market participants will be closely following the financial results of Zoom Communications in its upcoming release. The company plans to announce its earnings on February 25, 2026. In that report, analysts expect Zoom Communications to post earnings of $1.48 per share. This would mark year-over-year growth of 4.96%. Alongside, our most recent consensus estimate is anticipating revenue of $1.23 billion, indicating a 4.08% upward movement from the same quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $5.96 per share and revenue of $4.85 billion. These totals would mark changes of +7.58% and +4%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Zoom Communications. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Right now, Zoom Communications possesses a Zacks Rank of #3 (Hold).
From a valuation perspective, Zoom Communications is currently exchanging hands at a Forward P/E ratio of 15.6. For comparison, its industry has an average Forward P/E of 19.23, which means Zoom Communications is trading at a discount to the group.
Also, we should mention that ZM has a PEG ratio of 5.43. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Software was holding an average PEG ratio of 1.14 at yesterday's closing price.
The Internet - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 87, this industry ranks in the top 36% of all industries, numbering over 250.
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, Inc. (ZM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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