Zoom Communications (ZM) ended the recent trading session at $78.58, demonstrating a +1.28% change from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily gain of 0.83%. Meanwhile, the Dow gained 0.77%, and the Nasdaq, a tech-heavy index, added 1.02%.
Coming into today, shares of the video-conferencing company had lost 3.83% in the past month. In that same time, the Computer and Technology sector gained 8.25%, while the S&P 500 gained 4.99%.
Market participants will be closely following the financial results of Zoom Communications in its upcoming release. The company is predicted to post an EPS of $1.37, indicating a 1.44% decline compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $1.2 billion, up 3.02% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $5.59 per share and revenue of $4.81 billion, which would represent changes of +0.9% and +2.99%, respectively, from the prior year.
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. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent 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 last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.74% increase. Zoom Communications currently has a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that Zoom Communications has a Forward P/E ratio of 13.89 right now. This signifies a discount in comparison to the average Forward P/E of 28.74 for its industry.
Investors should also note that ZM has a PEG ratio of 7.45 right now. 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. Internet - Software stocks are, on average, holding a PEG ratio of 2.22 based on yesterday's closing prices.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 46, putting it in the top 19% 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.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Zoom Communications, Inc. (ZM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
