In the latest trading session, Zoom Communications (ZM) closed at $91.92, marking a +1.06% move from the previous day. The stock exceeded the S&P 500, which registered a gain of 1.05% for the day. At the same time, the Dow added 0.69%, and the tech-heavy Nasdaq gained 1.64%.
The stock of video-conferencing company has risen by 19.72% in the past month, leading the Computer and Technology sector's gain of 12.58% and the S&P 500's gain of 8.59%.
The investment community will be closely monitoring the performance of Zoom Communications in its forthcoming earnings report. The company is expected to report EPS of $1.41, down 1.4% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $1.22 billion, indicating a 4.16% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates project earnings of $5.87 per share and a revenue of $5.06 billion, demonstrating changes of -0.84% and +3.92%, respectively, from the preceding year.
Investors should also take note of any recent adjustments to analyst estimates for Zoom Communications. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending 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 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 remained stagnant. At present, Zoom Communications boasts a Zacks Rank of #3 (Hold).
Investors should also note Zoom Communications's current valuation metrics, including its Forward P/E ratio of 15.5. This denotes a discount relative to the industry average Forward P/E of 19.2.
Investors should also note that ZM has a PEG ratio of 3.49 right now. 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 1.13.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 88, putting it in the top 37% of all 250+ industries.
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.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
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Zoom Communications, Inc. (ZM): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).