ZMZoom Communications Inc. shows strong fundamental performance with healthy profitability and cash flow, positioned well within growth themes like remote work and collaboration. However, current technical indicators suggest potential short-term caution. The company's strong balance sheet and consistent earnings growth make it a compelling investment for long-term investors.
Zoom is a leader in enabling remote work and collaboration, benefiting from long-term secular trends. Its platform integrates AI and workflow automation, positioning it for continued growth in digital transformation. The company's expansion into areas like contact centers and employee experience platforms diversifies its revenue streams.
Zoom exhibits strong revenue and earnings growth, coupled with healthy profit margins and a robust balance sheet. The company consistently beats earnings expectations and generates significant free cash flow, providing financial flexibility. Its valuation metrics are reasonable given its growth profile.
Zoom's stock price is trading below key moving averages (50-day, 100-day, 200-day) on a daily chart, indicating a bearish short-term trend. While recent performance shows some recovery, the overall technical picture suggests potential for further downside or consolidation before a significant upward move.
| Factor | Score |
|---|---|
| Remote Work & Collaboration | 95 |
| AI Integration & Workflow Automation | 88 |
| Digital Transformation | 82 |
| Expansion into New Verticals | 80 |
| Competitive Landscape | 70 |
| Factor | Score |
|---|---|
| Valuation | 75 |
| Profitability | 90 |
| Growth | 70 |
| Balance Sheet Health | 95 |
| Cash Flow | 92 |
| Earnings Consistency | 90 |
| Factor | Score |
|---|---|
| Trend Analysis | 30 |
| Momentum | 50 |
| Support & Resistance | 65 |
| Volume | 60 |
| Recent Performance | 40 |
Consistent EPS Surprises
The company has consistently exceeded EPS estimates in the last 12 quarters, with surprise percentages ranging from 5.26% to 51.55%, indicating robust earnings execution.
Improving Forward P/E Ratio
The forward P/E ratio of 22.4 for fiscal year 2025Q1 is lower than the trailing P/E of 79.3 for 2025Q2, suggesting potential undervaluation based on future earnings expectations.
High P/E Ratios
The trailing P/E ratio is 22.71, and quarterly P/E ratios are significantly higher (e.g., 79.3 in 2025Q2), which might indicate the stock is overvalued relative to its current earnings.
Slowing Revenue Growth
While revenue has grown year-over-year (e.g., $4.67 billion in 2025Q1 vs. $4.53 billion in 2024Q1), the net margin has fluctuated, suggesting potential pressure on top-line growth efficiency.
August 2025
20
Next Earnings Date
H: $1.51
A: $1.38
L: $1.32
H: 1.21B
A: 1.20B
L: 1.19B
Zoom Communications Inc. provides an Artificial Intelligence-first work platform for human connection in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. The company offers Zoom Meetings that offers HD video, voice, chat, and content sharing through mobile devices, desktops, laptops, telephones, and conference room systems; Zoom Phone, a cloud phone system; and Zoom Team Chat enables users to share messages, images, files, and content in desktop, laptop, tablet, and mobile devices. It also provides Zoom Mail and Calendar; Zoom Workflow Automation, a no-code workflow builder that helps users build workflows across Zoom Workplace and third-party applications; Zoom Docs, a modular workspace; Zoom Whiteboard, an interactive canvas; and Zoom Clips for capturing video and screen content. In addition, the company offers Zoom Contact Center, an omnichannel contact center solution; Zoom Revenue Accelerator, a conversation intelligence software for Zoom Meetings and Zoom Phone; Zoom Events to manage, host, market, and report on all of virtual and hybrid events; Zoom Sessions that allows customers to use the signature features; and Zoom Webinars which supports interactive video presentations to large audiences. Further, it provides Workvivo, an all-in-one employee experience platform; Zoom Rooms, a software-based conference room system; Workspace Reservation; Zoom Developer Platform; App Marketplace which integrates platform with other applications, platforms, websites, and services; and Zoom Apps. It serves individuals; and education, entertainment/media, enterprise infrastructure, finance, government, healthcare, manufacturing, non-profit/not for profit and social impact, retail/consumer products, and software/Internet industries. The company was formerly known as Zoom Video Communications, Inc. and changed its name to Zoom Communications, Inc. in November 2024. The company was incorporated in 2011 and is headquartered in San Jose, California.
91.14 USD
The 39 analysts offering 1 year price forecasts for ZM have a max estimate of 115.00 and a min estimate of 65.00.