Yes, shares Zoom video communication (ZM) coronavirus has grown in emergencies. But what is the outlook for zoom stocks as the US economy normalizes?
The first quarterly earnings for the ZM stock will be May 23rd. Analysts expect EPS to fall to 88 cents, down 33% from a year earlier.
A Morgan Stanley analyst is optimistic. In a report, Morgan Stanley analyst Meta Marshall said, “We see Q1 earnings as a catalyst to disprove the highly bearish sentiment of ZM stocks near 2023 growth.”
Zoom’s cloud-based software sets up video calls, and chat tools are available. Also, customers can easily share content.
Within Covid-19, demand for zoom video conferencing software has increased as businesses have asked employees to work from home. Zooming has become a social phenomenon as video calling has become a routine for consumers to keep in touch with family and friends. The demand for distance learning and telemedicine has also increased the demand for cloud-based services of Zoom Video.
But growth has slowed as private meetings have resumed. When Zoom Video reported January-quarter earnings, it issued lower-than-expected fiscal 2023 guidelines. Zoom revenue growth forecast 11% vs. analyst estimates 15%.
So far in 2022, ZM stock has fallen nearly 51% in the volatility of technology-heavy Nasdaq Composite.
Further, a closely watched software benchmark – iShares Extended Tech-Software ETF (IGV) decreased by 31% in 2022.
For 2021, the IGV Software Index has grown 12.3%, compared to the S&P 500’s approximately 27% advance. In 2020, the software index rose about 52%, compared to the S&P 500’s 16.3% gain.
ZM Stock: Is Microsoft Team Essential a Threat?
ZM Stock Bulls argues that video calling will play a much bigger role in staying here and in business, school and everyday life. The problem is, even Zoom’s rivals think it’s a big market opportunity and they don’t want Zoom to dominate.
Microsoft (MSFT) has emerged as a major threat to team collaboration tools Microsoft recently launched a low-cost, standalone product called Tim’s Essential. It targets small businesses. Google-Guardian Alphabet (GOOGL) is a growing competitor.
As the coronavirus crisis eases, retaining small businesses as well as corporate accounts will be a key to Zoom’s success. For customers with one to 10 employees, renewals are expected to slow down as the economy resumes and orders will be lifted at the shelter. Larger customers are expected to have lower turnover.
Five 9 deals finished
Zoom In May acquired Solvvy, which uses artificial intelligence-based conversation tools in online customer support.
Zoom video and Five 9 (FIVN) has announced a deal to merge in July 2021. The all-stock contract was valued at 14.7 billion.
But the companies canceled the deal on September 30. Consolidation Five 9 did not receive the required votes for approval at the shareholder meeting.
Zoom stock has plummeted since the announcement. Launched in 2001, the Five9 website automates call center services, including chatbots or virtual assistants.
But Zoom Video aims to be the center of communication with its own products and services. And artificial intelligence software will probably play a role. Zoom Video has invested in Observe.AI, a startup that transforms communication center functions through AI.
It showed IQ for sale at Zoom’s recent “Work Transformation Summit”. The product provides conversation intelligence add-on tools for business meetings.
ZM Stock: Customer Retention Key
In the business market, Zoom’s competitors are included Ringcentral (RNG), Cisco system (CSCO), LogMeIn and Fuze.
While paying customers are important, the company’s roots are in the enterprise market. Annual recurring revenue growth is a metric that can be monitored for business customers with contracts at the top of $ 100,000.
Zoom Stock has raised $ 100 million for app developers.
Also, on June 29, Zoom Video appointed Ricky Kapoor, a former chief executive of Microsoft, as head of Asia Pacific Marketing. On the same day, it acquired information technology solutions from German startup Karlsruhe. The startup provides real-time language translation tools that use artificial intelligence.
According to Morgan Stanley, Zoom collects about 50% of its revenue from monthly payers. Zoom’s goal is to convert monthly business customers into annual contracts.
Zoom Stock: Video Call Mom Bell?
A “zoom meeting” refers to a video conferencing session hosted on the cloud infrastructure. During the Covid-19 crisis, increased demand led to increased investment in zoom computer servers.
One of the keys to Zoom’s success is a “freemium” business model. Zoom’s basic video calling package is free.
Zoom limits the number of participants in a group call and the length of the meeting. Often company management can learn about Zoom software when an employee reports a positive experience. The Zoom software follows previous video services and gets high ratings for ease of use and simplicity which provides shaky images and audio out of sync.
Many companies prefer zoom tools because they usually do not need the help of technical staff.
At the Jumtopia User Conference in mid-October 2020, Zoom Management introduced “Unzum”. It is an online event platform that is paid for. Towards the end of 2021, Zoom Startup acquired resources – event production equipment – from Limal.
Is a Zoom Phone a Potential Market Disruptor?
The paid zoom business plan costs 15 or প্রতি 20 per employee and requires a minimum of 10 or 50 seats. At the beginning of the coronavirus crisis, Zoom offered online coupon codes with discounts.
Zoom Phone, a cloud-calling product launched in 2019, allows customers to set up group Internet phone calls without video. Also, the Zoom phone competes with the products of Cisco, Avaya and RingCentral. Zoom Phone replaces the traditional business PBX phone system.
When Zoom reported first-quarter earnings, it revealed that as of April 30, the Zoom phone had 1.5 million users, up 500,000 from the end of 2020.
The Zoom chief arrived in the United States in 1997
Eric Yuan, CEO and founder of Zoom, came to the United States in 1997. He started with WebEx Communications and eventually became its vice president of engineering. Cisco acquired WebEx in 2007 for 3.2 billion. Yuan then became Cisco’s corporate vice president for collaboration software. He created the 2011 San Jose, California-based Zoom Video.
Zoom video aligned. Includes sales partners Slack Technologies (Team), Salesforce.com (CRM), Atlasian (Team) and Box (Box). Salesforce.com has invested in Zoom stock and made big profits before its initial public offering. However, Salesforce recently sold all its shares in Zoom Video.
However, Zoom Video is making new deals in the enterprise market, such as with software developers. Service now (Now).
Zoom stock fundamental analysis
Zoom earnings for the fourth quarter of 2021 were $ 1.29 per share on a consistent basis, up 6% from a year earlier.
Revenue for the ZM stock jumped 21% to 0 1.071 billion. A year ago, the company sold $ 883 million and earned $ 1.22 cents per share.
For FY 2023, Zoom forecasts earnings of $ 3.48 per share on earnings of $ 4.54 billion. Analysts had estimated a profit of $ 4.36 billion on revenue of $ 4.71 billion.
The Zoom Guide estimates that FY 2023 revenue growth is likely to accelerate again in the July quarter and later in the year.
Also, analysts expect that the 2023 financial profit margin will decrease between sales staff and higher investment in research and development.
Zoom Video announces 1 billion buyback. The company has a strong balance sheet with $ 5.4 billion in cash.
ZM stock historical performance
Zoom IPO raised $ 752 million in April 2019, valued at টি 36. ZM stocks popped 72% on the first day of trading.
After the company’s earnings and guidance remained at the top of expectations, on June 6, 2019, Zoom stock popped up again. It hit an intraday high of 107.34 on June 20, 198% higher than its IPO price. But in late June, some analysts questioned Zum’s high valuation as ZM stocks rallied.
Zoom stock has formed a cup chart pattern in almost eight months, reaching a low of 60.97 on October 23, 2019, 43% lower than the all-time high.
Prior to the coronavirus outbreak, the relative strength line of the ZM stock began to improve in January 2020.
As the coronavirus epidemic spread worldwide, on February 18 of that year, Zoom stock spread from the cup-with-handle by point of 93.40. ZM stocks rose in March as demand for corporate shift-foam-home video calling apps increased.
Shares receded in early April amid reports that hackers were entering the zoom meeting. The company has added new security features to prevent cyber attacks.
ZM Stock faced bad publicity about the “zoom bombing” in the video chat. The stock popped up in late April when it revealed that the number of daily active participants had reached 300 million – with some participants being counted more than once a day.
In May, Zoom Video became a cultural event.
ZM stock peaked at 588.84 on 19 October 2020. Zoom stock 2020 is over 400%.
But Zoom stock is 45% behind in 2021.
Zoom Stock: Buy It Now?
ZM Stock owns an IBD Relative Strength Rating of only 9 out of a best-possible 99. Relative strength ratings show how the price performance of a stock stacks up against all other stocks in the last 52 weeks.
Zoom Stock holds an IBD composite rating of 99 out of 40 possible bestsellers.
IBD’s composite rating combines five individual proprietary ratings into one easy-to-use rating. A composite rating of the best growth stocks is 90 or better.
In addition, Zoom stock holds a savings / distribution rating of D-minus. That rating analyzes the price and volume changes of a stock in the last 13 weeks of trading. Its current rating indicates that more funds are buying than selling.
Rating, on an A + to E scale, measures the institutional buying and selling of a stock. A + refers to heavy institutional purchases; This means heavy sales. Think of C grade as neutral.
As of May 23, ZM stock traded below an entry point. To be effective, Zoom Stock needs to build a new foundation.
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Follow Reinhard Kraus on Twitter reinhardtk_tech For updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
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