Zoom Communications (ZM) closed the most recent trading day at $81.61, moving -1.35% from the previous trading session. The stock fell short of the S&P 500, which registered a loss of 0.43% for the day. Meanwhile, the Dow experienced a drop of 0.07%, and the technology-dominated Nasdaq saw a decrease of 0.9%.
Shares of the video-conferencing company have depreciated by 0.46% over the course of the past month, underperforming the Computer and Technology sector's gain of 2.86% and outperforming the S&P 500's loss of 1.98%.
Market participants will be closely following the financial results of Zoom Communications in its upcoming release. In that report, analysts expect Zoom Communications to post earnings of $1.31 per share. This would mark a year-over-year decline of 7.75%. At the same time, our most recent consensus estimate is projecting a revenue of $1.18 billion, reflecting a 2.77% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $5.43 per share and a revenue of $4.66 billion, demonstrating changes of +4.22% and +2.87%, respectively, from the preceding year.
Investors should also pay attention to any latest changes in analyst estimates for Zoom Communications. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.89% higher within the past month. At present, Zoom Communications boasts a Zacks Rank of #1 (Strong Buy).
From a valuation perspective, Zoom Communications is currently exchanging hands at a Forward P/E ratio of 15.23. This valuation marks a discount compared to its industry's average Forward P/E of 32.53.
Meanwhile, ZM's PEG ratio is currently 2.81. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Internet - Software industry held an average PEG ratio of 2.31.
The Internet - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 27, finds itself in the top 11% echelons of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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