ZM Stock Fair Value Calculation – Zoom Shares on a Downward Trend as Losses Continue for Seventh Consecutive Session
January 6, 2024
🌧️Trending News
Zoom Video Communications ($NASDAQ:ZM), an online video conferencing and communication platform, has been struggling in the stock market lately. The company’s shares are expected to decline for the seventh consecutive session as losses continue to mount. This downward trend appears to be continuing, with Zoom shares dropping another 4% so far this week. The company has faced several issues lately, ranging from privacy concerns to user satisfaction problems.
In addition, there have been reports that Zoom has overstated its revenue figures, leading to increased scrutiny from investors. As a result, many analysts are expecting the company’s stock to continue its downward trend in the short-term.
Share Price
Zoom Video Communications has been experiencing losses for the past seven consecutive trading sessions, with its stock going down. This trend continued on Friday when the stock opened at $66.5 and closed at $67.0, a slight 0.1% increase from the prior closing price of 66.9. As the pandemic continues to put pressure on businesses, Zoom Video Communications has had to adjust its strategies and focus on cost reduction and debt management in order to stay afloat. It remains to be seen if the company can turn around its fortunes and restore investor confidence. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for ZM. More…
| Total Revenues | Net Income | Net Margin |
| 4.5k | 234.59 | 4.4% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for ZM. More…
| Operations | Investing | Financing |
| 1.46k | -1.12k | 47.7 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for ZM. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 9.32k | 1.9k | 24.36 |
Key Ratios Snapshot
Some of the financial key ratios for ZM are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 32.0% | -18.2% | 5.0% |
| FCF Margin | ROE | ROA |
| 29.4% | 2.0% | 1.5% |
Analysis – ZM Stock Fair Value Calculation
At GoodWhale, we analysed the wellbeing of ZOOM VIDEO COMMUNICATIONS and concluded that its intrinsic value stands at around $187.7. This valuation is based on our proprietary Valuation Line which takes into account multiple factors such as market trends, company financials, and overall market conditions. Currently, ZOOM VIDEO COMMUNICATIONS stock is trading at $67.0, which is undervalued by 64.3%. This presents an excellent opportunity for investors who are looking for a bargain and want to buy into a company with strong fundamentals. More…
Peers
In recent years, the video conferencing market has been growing rapidly with the advent of new technologies. Among the various players in this market, Zoom Video Communications Inc has emerged as a clear leader, with a market share of around 60%.
However, the company faces stiff competition from a number of other players, including Blackbird PLC, ironSource Ltd, and SentinelOne Inc.
– Blackbird PLC ($LSE:BIRD)
Blackbird PLC is a 54.22M market cap company with a ROE of -8.0%. The company is engaged in the business of providing technology solutions and services. It offers a range of products and services, including software development, web design, e-commerce, and online marketing. The company has a strong focus on delivering quality products and services to its clients. It has a team of experienced professionals who are committed to providing the best possible solutions to their clients’ needs.
– ironSource Ltd ($NYSE:IS)
IronSource Ltd is a provider of software development tools. The company has a market cap of 3.26B as of 2022 and a return on equity of 4.06%. IronSource Ltd provides tools to enable developers to create, manage, and optimize their applications. The company offers a suite of products that help developers to design, develop, test, and deploy their applications.
– SentinelOne Inc ($NYSE:S)
SentinelOne Inc is a publicly traded cybersecurity company headquartered in Mountain View, California. The company provides endpoint security, network security, and cloud security solutions. As of 2022, the company has a market capitalization of 6.58 billion and a return on equity of -12.5%. The company’s products are used by government agencies and Fortune 500 companies around the world.
Summary
Zoom Video Communications, Inc. has been enduring a seven-day streak of negative returns in the stock market. Analysts attribute this to investors’ concerns about Zoom’s slowing growth rate and increasing competition from other video-conferencing services. Despite its short-term losses, Zoom remains a valuable long-term investment opportunity due to its large user base, strong customer loyalty, and a successful track record of product innovation.
Zoom is also well-positioned to benefit from the continuing shift to remote work, which is expected to accelerate growth in the video conferencing industry. Investors should pay close attention to company developments and news surrounding competitors in order to make informed decisions when investing in this sector.
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