Are zoom shares a good buy.Is Zoom Video Stock A Buy After Recent Earnings? Our Call Is To ‘Mute’ This One
› investing › /04/19 › is-zoom-video-communications. Zoom Stock: Is It A Buy Right Now? ZM stock owns an IBD Relative Strength Rating of only 15 out of a best-possible The Relative Strength.
Should You Buy Zoom Stock Today? | The Motley Fool
Should I buy Zoom Video Communications (ZM)? Use the Zacks Rank and Style Scores to find out is ZM is right for your portfolio. Amidst all this stock volatility, Zoom has consistently produced strong business results, and the recent sell-off has made shares much more. IBD only gives Zoom stock a relative strength rating of 5 out of a possible 99, down from 40 as of August. IBD noted that in light of its.
Zoom Stock: Is It a Buy Right Now? | GOBankingRates.
Zoom is trading at price-to-free cash flow and price-to-earnings ratios of 22 and 24, respectively. According to those metrics, Zoom is significantly discounted. So, to answer the question posed in the headline, yes, Zoom stock looks like a buy right now. Cost basis and return based on previous market day close. Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of Discounted offers are only available to new members.
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Our Purpose:. Latest Stock Picks. Today’s Change. Current Price. ZM data by YCharts Zoom’s explosive growth is slowing down It’s essential to realize the company was growing revenue rapidly even before the pandemic. Image source: Getty Images. Zoom Video Communications. Motley Fool Returns Market-beating stocks from our award-winning service.
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Learn More. Zoom Video Communications ZM The company was a clear beneficiary of the work-from-home environment, a trend that is still very evident today. According to the U. It’s possible that the pandemic will have a lasting impact on our working environment, as many companies will be more open to a flexible work schedule moving forward. With Zoom well-positioned to capitalize on that new reality as a leader in the space, is today a great time to consider buying the company’s stock?
The significant climb in free cash flow was a result of superb revenue growth stemming from pandemic-driven demand. 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. 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 growth.
Zoom’s valuation has surely contracted, but it’s still not desirable when observing the company’s peer group. Today, Zoom is trading at Given the expected slowdown in Zoom’s growth, I think it’s safe to say that the company is still trading at expensive valuation multiples. Zoom’s financials remain strong, but I think the company needs to improve future growth prospects to justify trading at current valuation multiples.
With revenue and earnings growth expected to pull back in the years ahead, I wouldn’t be surprised to see growth-oriented investors exit their positions in Zoom stock. 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.
As a long-term investor , I don’t ignore past performance, but I’m generally more interested in where the company is heading. Zoom has provided investors with spectacular growth and returns in the past couple of years; however, I don’t see that continuing into the future. 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.
With growth expected to hit the breaks in the years ahead, the company will likely become less attractive to investors who bought into Zoom’s growth story. In addition to that, I don’t think Zoom is currently trading at an attractive-enough valuation — investors who are still excited about the stock may be wise to wait for a larger decline before considering an investment.
Zoom’s future doesn’t look quite as bright as it once did.