In the latest trading session, Zoom Communications (ZM) closed at $88.36, marking a +1.21% move from the previous day. The stock exceeded the S&P 500, which registered a loss of 0.17% for the day. At the same time, the Dow lost 0.26%, and the tech-heavy Nasdaq lost 0.09%.
The video-conferencing company's stock has dropped by 9.7% in the past month, falling short of the Computer and Technology sector's gain of 3.58% and the S&P 500's loss of 0.24%.
Analysts and investors alike will be keeping a close eye on the performance of Zoom Communications in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $1.5, reflecting a 1.32% decrease from the same quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $1.28 billion, up 3.99% from the prior-year quarter.
ZM's full-year Zacks Consensus Estimates are calling for earnings of $6.24 per share and revenue of $5.09 billion. These results would represent year-over-year changes of +5.41% and +4.58%, respectively.
It's also important for investors to be aware of any recent modifications to analyst estimates for Zoom Communications. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% lower. Zoom Communications is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, Zoom Communications is holding a Forward P/E ratio of 14. This signifies a discount in comparison to the average Forward P/E of 19.04 for its industry.
We can also see that ZM currently has a PEG ratio of 2.76. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. ZM's industry had an average PEG ratio of 1.11 as of yesterday's close.
The Internet - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 93, this industry ranks in the top 38% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the 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 Report
This article originally published on Zacks Investment Research (zacks.com).