The company helps businesses and organisations to bring their teams together in a frictionless environment to get more done without needing to be in the same room. Zoom is an easy and reliable cloud platform for video & voice chat, as well as content sharing. So, is this a buying opportunity? Zoom’s exploding stock price in 2020 Undoubtedly, this brought more income for the company.Īlthough the Zoom stock price surged in 2020, it’s down over 11% since the start of 2021 and down by 21% over the last 12 months.
Amidst the lockdown, several companies used Zoom’s platform to connect to their customers, investors and employees. For investors who believe Zoom's strong results can continue for years to come, now might be the time to pick up some shares at a discount.The Zoom Video Communications ( NASDAQ:ZM) stock price reached an all-time high of $588.84 last October. While that wouldn't be considered cheap, it is the lowest price-to-earnings multiple that Zoom has had since its IPO. On the flip side, the stock is now priced more reasonably, if not undervalued, for what's likely to be Zoom's business performance going forward.Īs of this writing, Zoom trades for 27 times earnings, only slightly above the S&P 500's multiple of 24.
While that was exciting if you were a shareholder, it made buying shares at that time a dicey proposition. When Zoom was growing revenue in the triple digits during 20, the market had the stock priced as if that growth would never slow. However, even if the results from this quarter continue to hold steady into the future, that level of business performance would still be impressive. It remains to be seen what growth looks like in the coming quarters and years as the business normalizes. Similarly, Zoom's enterprise customer growth of 24% was the lowest it's been in the past five quarters.Īs mentioned above, all of these metrics were bound to slow after Zoom pulled forward so much growth over the past few years. For example, while Zoom's net dollar retention rate for enterprise customers is very strong at 123%, that metric was 130% as recently as two quarters ago.
While Zoom's Q3 results are impressive, investors should be aware that some of these metrics are slowing from where they were over the past few quarters.
0 kommentar(er)
