The one area of modest strength is non-GAAP (adjusted) free cash flow, which increased almost 14% yearly to more than $1.1 billion in the first three quarters of 2023. That was not enough to persuade investors to buy Zoom stock, as it is up just 1% from year-ago levels. Zoom’s latest fiscal year (FY) was FY 2021, which ended Jan. 31, 2021. For that period, the company reported net income of $672.3 million on revenue of $2.7 billion.
That mascot character fxcc com cyprus based forex trading broker review is Eliza, an open-source framework for AI characters that can interact with people on social media. On Tuesday, Shaw “set her free” and endorsed the new ELIZA token, whose sanctioned creators have pledged to give a valuable chunk to ai16z’s treasury. The facts discussed here and much other information on Zacks.com might help determine whether or not it’s worthwhile paying attention to the market buzz about Zoom Video. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
Revenue vs. Earnings
Whereas during the pandemic the case could be made that the company’s valuation got ahead of itself, it’s clear now that the valuation is more in line with, if not underestimating, Zoom’s fundamentals. While the growth has slowed when compared to the pandemic highs, it’s clear that Zoom is still executing and growing — and worth considering heading into 2022. Each of these initiatives are designed to expand the business beyond the simple videoconferencing app the company became known for. Zoom Phone was called out on the most recent earnings call as having triple-digit year-over-year revenue growth, showing these new initiatives are starting to pay off. Its rise to prominence and the resulting performance were tied to a massive need for video communications at the height of lockdowns.
How many shares of Zoom (ZM) stock are there?
Zoom makes up almost 7% of its flagship fund, the Ark Innovation ETF, making the Cathie Wood investment its fourth-largest holding. Across all Ark Invest funds, Zoom makes up around 4.5% of the company’s holdings. Still, the bear estimate calls for a $700-per-share or less stock price, amounting to more than a 10-fold gain from current levels if that price target holds. And yet the business performed solidly throughout the past few years even as the stock fell.
Zoom Video Communications, Inc.
- Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors.
- In that same time, the Computer and Technology sector gained 0.18%, while the S&P 500 gained 0.62%.
- The pullback in pandemic-driven demand, in addition to increased competition from massive tech companies like Microsoft and Alphabet, will challenge Zoom’s business moving from here on out.
Zoom Video Communications (ZM 4.88%) is a bit systems development life cycle sdlc standard of a mystery as a growth stock. The company is headquartered in San Jose, Calif., and has additional offices in more than 15 locations in the United States, Europe, Asia, and Australia.
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The platform connects people via video, phone, chat, and content sharing and can be integrated across a broad range of devices. On the earnings front, Wall Street analysts are forecasting an average annualized growth of 28% over the next five years up to an earnings per share of $6.21 per share in fiscal year 2026. This is more favorable than Zoom’s expected top-line scenario, but many investors still might be hesitant to pay a lofty valuation for the company when taking into account the deceleration in what does a solutions architect do growth. For the current fiscal year, the consensus earnings estimate of $5.34 points to a change of +2.5% from the prior year. For the current quarter, Zoom Video is expected to post earnings of $1.31 per share, indicating a change of +1.6% from the year-ago quarter.
The slowdown in growth, combined with ongoing macroeconomic headwinds and geopolitical concerns, will put additional downward pressure on Zoom’s valuation for the foreseeable future. There is one caveat worth mentioning — Zoom’s growth in the coming years is expected to let up significantly from current levels. As the pandemic unwinds and Zoom becomes a more mature company, it’s inevitable that sales growth will come down from its all-time highs. Analysts are forecasting Zoom’s revenue to come in at $7.7 billion in fiscal year 2026, indicating an average annualized growth of 13% from 2022 estimates.
Therefore, you might want to consider some of the key factors that could influence the stock’s performance in the near future. Prior to founding Zoom, Yuan was corporate vice president of engineering at Cisco, and was a founding engineer and vice president of engineering for web and videoconferencing platform Webex. The U.S. government has been increasing its scrutiny of Zoom on several fronts.