While ZM stock has doubled, COST is down about 2.3% year-to-date. To begin: Zoom trades on the Nasdaq under the ticker symbol ZM. Stock Advisor launched in February of 2002. Following these remarkable results, the stock price jumped more than 30% from its previous-week all-time highs, valuing the company in excess of $120 billion. But that’s OK. (Photo by Taylor Hill/Getty Images). Find out why Zoom Video Communications is one of the 10 best stocks to buy now, Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. This comes to mind in considering San Jose, Calif.-based Zoom Video Communications — of which a whopping 41% of its shares were sold short as of … After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*. If Zoom is a company worth owning for the long haul, having to wait a day or two to buy it won’t make much difference in the end. Zoom Video Communications (NASDAQ:ZM) posted another exceptional quarter that smashed analysts' expectations and management's guidance. Investors looking beyond growth can choose long-term winners like Visa (NYSE:V) that remain well off their own highs. Pre-qualified offers are not binding. In contrast, scale boosted Zoom's operating margin as operating costs increased less than revenue. In contrast, scale boosted Zoom's operating margin as operating costs increased less than revenue. These are the 20 best stocks in the S&P 500, based on year-to-date performance. Many or all of the products featured here are from our partners who compensate us. Zoom Video Stock Will Be a Buy When It Settles Down, Matt McCall and the InvestorPlace Research Staff. 1125 N. Charles St, Baltimore, MD 21201. The power of being “first” gave Matt’s readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Following these remarkable results, the stock price jumped more than 30% from its previous-week all-time highs, valuing the company in excess of $120 billion. Equipped with its 15-year experience as a former IT engineer, Herve covers the tech sector. In addition, management raised its full-year guidance substantially despite claiming a conservative approach. Microsoft may earn an Affiliate Commission if you purchase something through recommended links in this article. Zoom Hardware as a Service: a set of subscription services for audio and video communications hardware. That giant never has been able to drive consistent growth in Skype for Business. Unlike a lot of high-multiple growth companies, Zoom is profitable as well. After reporting earnings on December 5, the stock — which soared 45% to peak at $105 on July 31 — lost nearly 10% of its value between its earnings report and the market close on December 6. Given its spectacular results, Zoom deserves to be valued at a premium. Zoom Video Communications Stock , ZM. With such a challenging risk-reward situation, investors should stay on the sidelines. In addition, competition in the video communications market for consumers and enterprises is intensifying. » View our list: The best-performing stocks. Show full articles without "Continue Reading" button for {0} hours. Yet in this still-bearish market, COST stock has weakened modestly since then. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. “Zoom reported strong third-quarter results and offered better-than-expected guidance for the fourth quarter...Zoom is the most expensive stock on a price/sales basis in our coverage list by a wide margin. Our opinions are our own. Yet that doesn't mean it's an attractive investment. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Morningstar sees the growth coming from the new product and geographic expansion. Even with that large scope that takes into account contact center solutions that Zoom doesn't offer, Zoom's market cap above $120 billion suggests the company will dominate that unified communications market over the long term. And these cross-selling opportunities are growing, too. Given that, is Zoom stock still a buy? You may opt-out by. Here is some information to help you decide. Zoom Rooms is the original software-based conference room solution used around the world in board, conference, huddle, and training rooms, as well as executive offices and classrooms. Here are four reasons: Analysts Like Zoom’s Growth Strategy — But Valuation Is High. Is Zoom Video Communications Stock a Buy? See you at the top! [One new customer —] USPS, is starting to deploy Zoom Meetings more broadly across the organization after an extensive proof-of-concept,” according to Zoom’s December 5 earnings conference call transcript. Zoom Video doesn't appear a compelling earnings-beat candidate. I ditched corporate America in 1994 and started a management consulting and venture capital firm (http://petercohan.com). ZM stock is not cheap. The Ascent is The Motley Fool's new personal finance brand devoted to helping you live a richer life. It now expects full-year revenue to land in the range of $2.37 billion to $2.39 billion, compared to the previous range of $905 million to $915 million in March. Data source: Zoom video communications. But profitability is just one of many factors investors should consider before buying a stock. Cumulative Growth of a $10,000 Investment in Stock Advisor, Is Zoom Video Communications Stock a Buy? When he's not busy writing about cybersecurity, cloud computing, and other fascinating technologies, he enjoys running and traveling. All rights reserved. It also reinforces the company's network effect and cross-selling opportunities between its different video and phone communication products. But these lofty valuation ratios seem to already price in exceptional performance over the long term, without considering the intensifying competition, which doesn't offer much margin of safety for prudent investors. Given that Zoom's stock price had more than tripled since the beginning of the year, there's no doubt the market was expecting the video specialist to show strong first-quarter results. As a result, Zoom Video saw its stock price jump about 164% year-to-date. Nasdaq (New to this? In addition, besides the usual competition from giant techs such as Microsoft and Cisco Systems, with their respective communication solutions Teams and Webex, the enterprise market is becoming crowded, too. You’re likely going to choose between a market order (“buy this stock right now at the prevailing market price”) or a limit order (“buy this stock only if it’s available at the price I’ve specified”). In short, you’ll want to look for a broker that has a low account minimum, reasonable commissions (which you’ll pay when you buy shares of Zoom) and a user-friendly platform. Paid subscription thereafter, see Morningstar.com for details. Thus, despite a lower gross margin, Zoom's adjusted operating margin reached an astonishing 41.7%, up from 14.2% the year before. What Is a Brokerage Account and How Do I Open One? View which stocks have been most impacted by COVID-19. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Alphabet’s (NASDAQ:GOOG,NASDAQ:GOOGL) Google Hangouts appears to have relatively small share. Up to $725 cash bonus when you open and fund a new account with $25,000 or more in new money. While both companies are growing revenues more slowly — LogMeIn (64.3% average annual growth in the last three years) and RingCentral (31.5%) — Zoom’s valuation still appears high compared to its more than 100% growth. I also teach business strategy and entrepreneurship at Babson College in Wellesley, Mass. It’s not just a short-term tailwind. And these cross-selling opportunities are growing, too. In addition to the launch of its cloud phone system, Zoom Phone, at the end of 2018, the company announced this quarter two offerings that will facilitate the consumption of its communication services: Given these better-than-expected second-quarter results, management again raised the guidance it had already meaningfully raised during the previous quarter. But more remarkably, new customers accounted for approximately 81% of revenue growth. To justify a high valuation, a company has to keep growing faster than investors expect. Zoom stock broke out on Feb. 18 from a cup-with-handle buy point of 93.40 as the coronavirus pandemic began to spread globally. Free cash flow jumped from $17.1 million one year ago to $373.4 million. Some smaller stocks have provided stronger year-to-date returns. Click here to get access to the full list! And Zoom's revenue growth remains constrained by its total addressable market. These days valuation is not the thing that moves a company’s stock price. Equipped with its 15-year experience as a former IT engineer, Herve covers the tech sector. When he's not busy writing about cybersecurity, cloud computing, and other fascinating technologies, he enjoys running and traveling. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free. I began following stocks in 1981 when I was in, I ditched corporate America in 1994 and started a management consulting and venture capital firm (http://petercohan.com).

He Brought Me Here Meaning, What Is The Census Citizenship Question, Nrl Premierships 2019, Evicted: Poverty And Profit In The American City Pdf, Tommy Lee Lyrics, Microeconomics (SparkCharts), Guy Sebastian Together At Home, Rudy Giuliani Common Sense Episodes, Watch Dodgers Online Spectrum, Don Dokken Surgery,