Zoom Communications (ZM) shares rose 2.64 percent to $107.47 in the latest trading session, outperforming the S&P 500's 0.21 percent gain. Over the past month, the stock has climbed 16.64 percent versus a 3.25 percent gain in the S&P 500 and a 3.8 percent advance in the Computer and Technology sector.
The video-conferencing company reports earnings on August 25. Wall Street consensus expects earnings per share of $1.50, down 1.96 percent year-over-year, with revenue of $1.27 billion, up 4.22 percent. For full-year 2026, analysts project EPS of $6.17, up 4.22 percent, and revenue of $5.09 billion, up 4.54 percent.
Zoom trades at a forward P/E of 16.96, a 20.6 percent discount to the Internet-Software industry average of 21.39. The gap widens when measured against growth: The company's PEG ratio of 3.82 significantly trails the sector's 0.97, signaling that the market is pricing in below-consensus earnings revisions or questioning the durability of near-term growth.
The Zacks Rank assignment is #3 (Hold). The consensus EPS estimate has not moved in the past month.
Investors should focus on two catalysts in the August report: first, whether management can demonstrate margin expansion despite flat EPS guidance, and second, early adoption metrics for Workvivo, the employee experience platform, which represents the company's main strategic pivot into higher-margin software services beyond core conferencing.
