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What Is Zoom and How Does It Work?

ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities. Investors should also note any recent changes to analyst estimates for Zoom Video 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 company’s business outlook. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

  1. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
  2. I’ve been actively trading the Futures and Forex markets since 2014.
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  4. Its capabilities include meeting/chat summaries and smart recordings.
  5. 69% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider.

We discount the terminal cash flows to today’s value at a cost of equity of 8.0%. 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. https://forexhero.info/ 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.

Here’s Why Zoom Video Communications (ZM) Gained But Lagged the Market Today

That should keep it in the top tier of players in the market. The in-meeting features offered by Zoom are designed to be easy to find, easy to use and work as expected. Hosts are given the ability to mute and unmute participants, turn off screen sharing for attendees, make other people joint hosts and rename people once they have dialed in. Zoom also gives users the option to share individual desktop windows rather than an all-encompassing screen share, which is preferable for privacy. Zoom Video Communications is currently sporting a Zacks Rank of #3 (Hold).

“We think the potential for major M&A is creating uncertainty among investors,” JPMorgan analyst Mark R. Murphy says. Upgrade to MarketBeat All Access to add more stocks to your watchlist. For the October quarter, Zoom Video earned an adjusted $1.29 a share, up 21% from a year earlier. Zoom Video has built up alliances with the likes of Salesforce.com (CRM), Atlassian (TEAM) and Box (BOX). Salesforce.com invested in Zoom stock prior to its initial public offering and reaped big gains. One bright spot, ZM stock had $6.5 billion on its balance sheet as of Sept. 30.

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Zoom’s cloud-based software sets up video calls, with chat tools available. Zoom Video is racing to build more artificial intelligence tools into its business communications platform. Zoom Video recently backed off from a change in its terms of service for platform users that would have enabled it to gather data to train AI models.

Luke Meindl has no position in any of the companies mentioned.The Motley Fool owns and recommends Alphabet (A shares), Cisco Systems, Microsoft, and Zoom Video Communications. IG International Limited is part of the IG Group and its ultimate parent company is IG Group Holdings Plc. IG International Limited receives services from other members of the IG Group including IG Markets Limited. IG International Limited is licensed to conduct investment business and digital asset business by the Bermuda Monetary Authority.


With an end-of-year rally, Zoom stock advanced 6% in 2023. The Nasdaq composite shot up 43% amid buzz over generative artificial intelligence technology. The U.S. government has been increasing its scrutiny of Zoom on several fronts. In 2020, the United States charged a China-based Zoom executive with conspiring to disrupt videoconference commemorations of the 1989 Tiananmen Square democracy protests. Zoom is also the focus of several ongoing federal investigations related to its dealings with Beijing, according to the Journal.

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However, unlike the free plan, once you start hosting your video calls via a paid plan, there is no time limit. The Business plan costs $20/host/month, requires a minimum of 10 hosts and allows up to 300 users per call. The Enterprise plan also costs $20/host/month, but requires a minimum of 100 hosts.

Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts’ positivity towards the company’s business operations and its ability to generate profits. Zoom’s valuation has surely contracted, but it’s still not desirable when observing the company’s peer group.

Then the COVID-19 pandemic erupted, first in China, then around the world. On Feb. 26, Zoom announced it had already added more new users in the first two months of 2020 than it had in all of 2019. Within a month, as the pandemic spread, office workers suddenly found themselves jumping on daily Zoom calls from the comfort of home in a desperate attempt to keep in touch with colleagues. In 2018 I started Tradamaker a site that specializes in trading resource tutorials. I use my professional background in probability, statistics, risk analysis, uncertainty, pattern recognition, coding and charting to help fellow traders get the most out of online trading software and tools.

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69% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. Following the Covid-19 pandemic that impacted many workers’ lives throughout the world, Zoom’s stock reached a high point of approximately £570 in September 2020. Since this point, Zoom’s share price dropped slightly and is currently on a downtrend, trading for approximately £330 as of March 2021. This is still a much higher price than it was trading at the same point last year.

Shares of the video-conferencing company witnessed a loss of 11.94% over the previous month, trailing the performance of the Computer and Technology sector with its gain of 2.15% and the S&P 500’s gain of 2.99%. Zoom Video Communications (ZM 1.25%) rewarded shareholders who bought the stock prior to the pandemic, returning 391% in 2020. The company was a clear beneficiary of the work-from-home environment, a trend that is still very evident today. Bureau of Labor statistics released in January, 11% of workers were still teleworking as of December 2021.

Cathie Wood’s ETFs are now buying Tesla’s stock

They already support a rich API set that easily integrates with a number of applications. The platform’s basic plan is free and allows up to 100 users per call. The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988.

Analysts had been looking for earnings of $1.09 a share on sales of $1.13 billion in the fiscal fourth quarter. Yuan then became Cisco’s corporate vice president of engineering for collaboration software. He later formed San Jose, Calif.-based Zoom Video in 2011. In July 2021, Zoom Video and Five9 (FIVN), which automates call center services, announced a deal to merge. The all-stock deal was originally valued at $14.7 billion.

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