Upside case
Bull case
$184+74.7%
ZM would need investors to value it at roughly 31x earnings — about 13x more generous than today's 18x forward P/E. That requires meaningful multiple expansion on top of continued earnings growth.
Analysis OverviewHoldUpdated May 1, 2026
Zoom Communications, Inc. (ZM) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Hold
Covering
48
analysts
18 bullish · 4 bearish · 48 covering ZM
Strong Buy
0
Buy
18
Hold
26
Sell
4
Strong Sell
0
Consensus Target
$101
-4.3% vs today
Scenario Range
— – $184
Model bear to bull value window
Coverage
48
Published analyst ratings
Valuation Context
17.9x
Forward P/E · Market cap $32.3B
ZM price targets
Three scenarios for where ZM stock could go
Current
~$105
Confidence
57 / 100
Updated
May 1, 2026
Where we are now
Current · $105
Base
$114
Bull
$184
Market caseClosest to today
Base case
$114+8.8%
This is close to how the market is already pricing ZM — at roughly 19x forward earnings. No dramatic re-rating needed, just steady execution on the core business.
Stress case
Bear case
—
The bear case reflects a scenario where earnings shortfalls or multiple compression combine to materially reduce the stock from its current level.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
Zoom Communications, Inc.
ZM · NASDAQTechnologySoftware - ApplicationJanuary year-end
Zoom is a video-first communications platform that provides cloud-based video conferencing, phone, chat, and webinar services. It generates revenue primarily through subscription fees from businesses and individual users — with enterprise customers contributing the majority of its sales — along with some advertising and hardware sales. Its key advantage is its reliable, easy-to-use platform that became the de facto standard for remote communication during the pandemic, creating strong network effects and high switching costs.
Market Cap
$32.3B
Revenue TTM
$4.9B
Net Income TTM
$1.9B
Net Margin
39.0%
ZM Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
92%Exceptional
12 quarters tracked
Revenue Beat Rate
100%Exceptional
vs consensus estimates
Avg EPS Surprise
+12.7%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Last 4 Quarters
EPS beats: 3 of 4Q2 2025
EPS
$1.43/$1.31
Revenue
$1.2B/$1.2B
Q3 2025
EPS
$1.53/$1.38
Revenue
$1.2B/$1.2B
Q4 2025
EPS
$1.52/$1.44
Revenue
$1.2B/$1.2B
Q1 2026
EPS
$1.44/$1.49
Revenue
$1.2B/$1.2B
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q2 2025 | $1.43/$1.31 | +9.2% | $1.2B/$1.2B | +0.7% |
| Q3 2025 | $1.53/$1.38 | +10.9% | $1.2B/$1.2B | +1.6% |
| Q4 2025 | $1.52/$1.44 | +5.6% | $1.2B/$1.2B | +1.3% |
| Q1 2026 | $1.44/$1.49 | -3.4% | $1.2B/$1.2B | +1.0% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$5.1B
+4.9% YoY
FY2
$5.4B
+5.2% YoY
EPS Outlook
FY1
$6.23
-0.6% YoY
FY2
$6.72
+7.8% YoY
Trailing FCF (TTM)$1.9B
FCF Margin: 39.5%
Next Earnings
May 20, 2026
Expected EPS
$1.41
Expected Revenue
$1.2B
ZM beat EPS estimates in 3 of 4 tracked quarters. A strong delivery record supports forward estimate credibility.
ZM Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $4.7B
Product Mix
Latest annual revenue by segment or product family
Reportable Segment
100.0%
YoY unavailable
Tap, hover, or focus a slice to inspect segment detail.
Geographic Mix
Latest annual revenue by reported region
Americas
71.8%
+3.8% YoY
Tap, hover, or focus a slice to inspect segment detail.
Reportable Segment is the largest disclosed segment at 100.0% of FY 2025 revenue, with no year-over-year comparison yet.
Americas is the largest reported region at 71.8%, up 3.8% YoY.
ZM Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Significantly Undervalued
Fair value est. $714 — implies +590.5% from today's price.
Upside to Fair Value
590.5%
potential upside
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
ZM
17.0x
vs
S&P 500
25.2x
33% discount
vs Technology Trailing P/E
ZM
17.0x
vs
Technology
27.5x
38% discount
vs ZM 5Y Avg P/E
Today
17.0x
vs
5Y Average
26.9x
37% discount
Forward PE
17.9x
S&P 500
19.1x
-6%
Technology
21.7x
-18%
5Y Avg
—
—
Trailing PE
17.0x
S&P 500
25.2x
-33%
Technology
27.5x
-38%
5Y Avg
26.9x
-37%
PEG Ratio
0.76x
S&P 500
1.75x
-56%
Technology
1.47x
-48%
5Y Avg
—
—
EV/EBITDA
24.7x
S&P 500
15.3x
+62%
Technology
17.4x
+42%
5Y Avg
37.4x
-34%
Price/FCF
16.8x
S&P 500
21.3x
-21%
Technology
19.8x
-15%
5Y Avg
19.0x
-12%
Price/Sales
6.6x
S&P 500
3.1x
+112%
Technology
2.4x
+175%
5Y Avg
6.6x
+1%
Dividend Yield
—
S&P 500
1.88%
—
Technology
1.18%
—
5Y Avg
—
—
| Metric | ZM | S&P 500 | Technology | 5Y Avg ZM |
|---|---|---|---|---|
| Forward PE | 17.9x | 19.1x | 21.7x-18% | — |
| Trailing PE | 17.0x | 25.2x-33% | 27.5x-38% | 26.9x-37% |
| PEG Ratio | 0.76x | 1.75x-56% | 1.47x-48% | — |
| EV/EBITDA | 24.7x | 15.3x+62% | 17.4x+42% | 37.4x-34% |
| Price/FCF | 16.8x | 21.3x-21% | 19.8x-15% | 19.0x-12% |
| Price/Sales | 6.6x | 3.1x+112% | 2.4x+175% | 6.6x |
| Dividend Yield | — | 1.88% | 1.18% | — |
ZM trades above S&P 500 benchmarks on 2 of 6 measured multiples — is elevated on some multiples, but competitive on others — a mixed valuation picture.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolZM Financial Health
Verdict
Strong
ZM generates $1.9B in free cash flow at a 39.5% margin — 10.4% ROIC signals a durable competitive advantage · returns 5.0% of market cap to shareholders annually.
Cash Engine
Revenue, margins, and cash generation
Revenue (TTM)
Trailing-twelve-month sales base
$4.9B
Revenue Growth
TTM vs prior year
+4.4%
Gross Margin
Gross profit as a share of revenue
77.0%
Operating Margin
Operating income divided by revenue
23.1%
Net Margin
Net income divided by revenue
39.0%
EPS (TTM)
Diluted earnings per share, trailing twelve months
$6.27
Free Cash Flow (TTM)
Cash generation after capex
$1.9B
FCF Margin
FCF as share of revenue — the primary cash quality signal
39.5%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
10.4%
ROA
Return on assets, trailing twelve months
15.9%
Cash & Equivalents
Liquid assets on the balance sheet
$1.3B
Net Cash
Cash exceeds total debt — no net leverage
$1.2B
Debt Serviceability
Net debt as a multiple of annual free cash flow
Net cash ✓
ROE
Return on equity, trailing twelve months
19.4%
Shareholder Returns
How capital is returned to owners
Total shareholder yield
5.0%
Dividend
—
Buyback
5.0%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$1.6B
Dividend / Share
Annualized trailing dividend per share
—
Payout Ratio
Share of earnings distributed as dividends
—
Shares Outstanding
Declining as buybacks retire shares
307M
All figures from the trailing twelve months. ROIC uses invested capital (equity + net debt).
Open full ratios pageZM Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 29, 2026
High Risk
Competition and Market Saturation
Zoom operates in a highly competitive market for communication technologies, facing risks from larger players offering integrated solutions that could pressure pricing and market share. Additionally, market saturation and changing user habits could significantly impact future growth expectations.
High Risk
Financial and Valuation Risks
Despite a strong balance sheet, Zoom's stock valuation is considered a significant risk, particularly for new investors. The stock's price has dropped to 'egregiously low levels' due to a growth slowdown, raising concerns about its market opportunity and competitive position.
Medium
Technological Disruption and AI
There are fears that AI agents from companies like Anthropic and OpenAI could disrupt traditional software business models, potentially eroding Zoom's seat-based revenue. However, some analysts believe Zoom's real-time video conferencing platform may be less susceptible to such disruptions.
Medium
Operational and Strategic Concerns
Zoom faces a growth slowdown and skepticism regarding its market opportunity, impacting its stock performance. Concerns about its international go-to-market strategy and the need for a revamped approach to sales and marketing could hinder future growth.
Medium
General Market and Economic Factors
General economic conditions and slow growth in its markets can negatively impact Zoom's stock price, which has shown volatility. Additionally, ineffective disclosure controls could erode investor confidence, further affecting stock performance.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why ZM Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 29, 2026
Market Leadership and Resilience
Zoom remains a leader in video communications and has transitioned from a pandemic-era darling to a resilient player in unified communications. Its platform, Zoom Workplace, integrates meetings, phone, chat, and contact center solutions.
AI Integration and Future Growth
The company is focusing on an AI-first strategy, aiming to integrate machine learning across its platform to simplify workflows and automate tasks. This includes AI features like AI Companion, Virtual Agent 2.0, and Contact Center Elite, which are expected to drive steady revenue growth.
Financial Strength and Profitability
Zoom boasts a strong balance sheet with significant cash reserves of around $7.8 billion and generates substantial free cash flow. Recent earnings reports show accelerating revenue growth, particularly in the enterprise segment, and expanding operating margins.
Enterprise Momentum
Sales to enterprise customers are growing, now accounting for a significant portion of total revenue. High-value enterprise customers have also seen year-over-year growth.
Product Diversification
Beyond core video conferencing, Zoom is seeing growth in products like Zoom Phone and Zoom Contact Center, indicating diversification beyond its original offering.
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
ZM Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$105.13
52W Range Position
89%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$69.15
+52.0% from the low
52-Week High
$109.50
-4.0% from the high
1 Month
+27.15%
3 Month
+14.02%
YTD
+26.2%
1 Year
+34.7%
3Y CAGR
+18.7%
5Y CAGR
-18.5%
10Y CAGR
+5.4%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
ZM vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
17.9x
vs 22.1x median
-19% below peer median
Revenue Growth
+4.9%
vs +7.0% median
-30% below peer median
Net Margin
39.0%
vs 20.8% median
+88% above peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
ZM ZM Zoom Communications, Inc. | $32.3B | 17.9x | +4.9% | 39.0% | Hold | -4.3% |
MSF MSFT Microsoft Corporation | $3.07T | 24.9x | +7.0% | 39.3% | Buy | +33.3% |
GOO GOOGL Alphabet Inc. | $4.81T | 29.6x | +14.1% | 37.9% | Buy | +2.1% |
CSC CSCO Cisco Systems, Inc. | $362.9B | 22.1x | +4.2% | 18.8% | Buy | +5.3% |
RNG RNG RingCentral, Inc. | $4.1B | 9.4x | +7.0% | 1.7% | Buy | -17.6% |
NIC NICE NICE Ltd. | $5.9B | 8.8x | +9.1% | 20.8% | Buy | +55.8% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
ZM Dividend and Capital Return
ZM returns 5.0% annually — null% through dividends and 5.0% through buybacks.
Dividend UnknownFCF Unknown
Total Shareholder Yield
5.0%
Dividend + buyback return per year
Buyback Yield
5.0%
Dividend Yield
—
Payout Ratio
—
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$0.00
Growth Streak
Consecutive years of dividend increases
0Y
3Y Div CAGR
—
5Y Div CAGR
—
Ex-Dividend Date
—
Payment Cadence
—
0 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$1.6B
Estimated Shares Retired
15M
Approx. Share Reduction
5.0%
Shares Outstanding
Current diluted share count from the screening snapshot
307M
At 5.0%/year, buybacks mechanically lift EPS even with flat earnings — each remaining share represents a slightly larger piece of the company.
FAQ
7 questionsZM Investor Questions
Common questions answered from live analyst data and company financials.
01Is Zoom Communications, Inc. (ZM) stock a buy or sell in 2026?
Zoom Communications, Inc. (ZM) is rated Hold by Wall Street analysts as of 2026. Of 48 analysts covering the stock, 18 rate it Buy or Strong Buy, 26 rate it Hold, and 4 rate it Sell or Strong Sell. The consensus 12-month price target is $101, implying -4.3% from the current price of $105.
02What is the ZM stock price target for 2026?
The Wall Street consensus price target for ZM is $101 based on 48 analyst estimates. The high-end target is $115 (+9.4% from today), and the low-end target is $87 (-17.2%). The base case model target is $114.
03Is Zoom Communications, Inc. (ZM) stock overvalued in 2026?
ZM trades at 17.9x times forward earnings. The stock currently trades at a discount to the broader market. Based on current multiples versus the peer group, the relative model signals significantly undervalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for Zoom Communications, Inc. (ZM) stock in 2026?
The primary risks for ZM in 2026 are: (1) Competition and Market Saturation — Zoom operates in a highly competitive market for communication technologies, facing risks from larger players offering integrated solutions that could pressure pricing and market share. (2) Financial and Valuation Risks — Despite a strong balance sheet, Zoom's stock valuation is considered a significant risk, particularly for new investors. (3) Technological Disruption and AI — There are fears that AI agents from companies like Anthropic and OpenAI could disrupt traditional software business models, potentially eroding Zoom's seat-based revenue. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is Zoom Communications, Inc.'s revenue and earnings forecast?
Analyst consensus estimates ZM will report consensus revenue of $5.1B (+4.9% year-over-year) and EPS of $6.23 (-0.6% year-over-year) for the upcoming fiscal year. The following year, analysts project $5.4B in revenue.
06When does Zoom Communications, Inc. (ZM) report its next earnings?
Zoom Communications, Inc. is expected to report its next earnings on approximately 2026-05-20. Consensus expects EPS of $1.41 and revenue of $1.2B. Over recent quarters, ZM has beaten EPS estimates 92% of the time.
07How much free cash flow does Zoom Communications, Inc. generate?
Zoom Communications, Inc. (ZM) generated $1.9B in free cash flow over the trailing twelve months — a free cash flow margin of 39.5%. ZM returns capital to shareholders through and share repurchases ($1.6B TTM).