ZOOM VIDEO COMMUNICATIONS-A (ZM)
US98980L1017 - Common Stock
Taking everything into account, ZM scores 6 out of 10 in our fundamental rating. ZM was compared to 275 industry peers in the Software industry. ZM gets an excellent profitability rating and is at the same time showing great financial health properties. A decent growth rate in combination with a cheap valuation! Better keep an eye on ZM. These ratings could make ZM a good candidate for value and quality investing.
1. Profitability
1.1 Basic Checks
In the past year ZM was profitable.
ZM had a positive operating cash flow in the past year.
ZM had positive earnings in each of the past 5 years.
In the past 5 years ZM always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.42%, ZM belongs to the top of the industry, outperforming 84.00% of the companies in the same industry.
ZM's Return On Equity of 7.95% is amongst the best of the industry. ZM outperforms 81.09% of its industry peers.
ZM has a Return On Invested Capital of 4.33%. This is in the better half of the industry: ZM outperforms 77.45% of its industry peers.
ZM had an Average Return On Invested Capital over the past 3 years of 5.53%. This is below the industry average of 10.17%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.42% | ||
| ROE | 7.95% | ||
| ROIC | 4.33% |
ROA(3y)8.64%
ROA(5y)8.05%
ROE(3y)11.14%
ROE(5y)10.68%
ROIC(3y)5.53%
ROIC(5y)5.44%
1.3 Margins
ZM has a better Profit Margin (14.08%) than 85.09% of its industry peers.
ZM's Profit Margin has declined in the last couple of years.
The Operating Margin of ZM (13.21%) is better than 84.73% of its industry peers.
In the last couple of years the Operating Margin of ZM has grown nicely.
The Gross Margin of ZM (76.35%) is better than 72.73% of its industry peers.
In the last couple of years the Gross Margin of ZM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.21% | ||
| PM (TTM) | 14.08% | ||
| GM | 76.35% |
OM growth 3Y-22.84%
OM growth 5Y43.97%
PM growth 3Y-17.77%
PM growth 5YN/A
GM growth 3Y3.36%
GM growth 5Y-1.35%
2. Health
2.1 Basic Checks
ZM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
ZM has more shares outstanding than it did 1 year ago.
ZM has more shares outstanding than it did 5 years ago.
There is no outstanding debt for ZM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
ZM has an Altman-Z score of 7.58. This indicates that ZM is financially healthy and has little risk of bankruptcy at the moment.
ZM's Altman-Z score of 7.58 is amongst the best of the industry. ZM outperforms 83.27% of its industry peers.
There is no outstanding debt for ZM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 7.58 |
ROIC/WACC0.44
WACC9.83%
2.3 Liquidity
ZM has a Current Ratio of 4.50. This indicates that ZM is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 4.50, ZM belongs to the top of the industry, outperforming 85.82% of the companies in the same industry.
A Quick Ratio of 4.50 indicates that ZM has no problem at all paying its short term obligations.
ZM has a better Quick ratio (4.50) than 85.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.5 | ||
| Quick Ratio | 4.5 |
3. Growth
3.1 Past
ZM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 19.22%, which is quite good.
The Earnings Per Share has been growing by 16.09% on average over the past years. This is quite good.
Looking at the last year, ZM shows a small growth in Revenue. The Revenue has grown by 3.06% in the last year.
ZM shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 68.78% yearly.
EPS 1Y (TTM)19.22%
EPS 3Y16.09%
EPS 5YN/A
EPS growth Q2Q16.39%
Revenue 1Y (TTM)3.06%
Revenue growth 3Y19.52%
Revenue growth 5Y68.78%
Revenue growth Q2Q2.56%
3.2 Future
ZM is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 2.85% yearly.
ZM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.25% yearly.
EPS Next Y-2.77%
EPS Next 2Y-0.81%
EPS Next 3Y0.2%
EPS Next 5Y2.85%
Revenue Next Year2.3%
Revenue Next 2Y3.13%
Revenue Next 3Y3.69%
Revenue Next 5Y6.25%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
ZM is valuated reasonably with a Price/Earnings ratio of 11.48.
Based on the Price/Earnings ratio, ZM is valued cheaper than 92.00% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 24.80. ZM is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 11.81, the valuation of ZM can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ZM indicates a rather cheap valuation: ZM is cheaper than 91.27% of the companies listed in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.27, ZM is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.48 | ||
| Fwd PE | 11.81 |
4.2 Price Multiples
ZM's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. ZM is cheaper than 94.18% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ZM is valued cheaply inside the industry as 93.09% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.5 | ||
| EV/EBITDA | 8.64 |
4.3 Compensation for Growth
The decent profitability rating of ZM may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-0.81%
EPS Next 3Y0.2%
5. Dividend
5.1 Amount
ZM does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
ZOOM VIDEO COMMUNICATIONS-A
NASDAQ:ZM (4/19/2024, 9:43:04 AM)
59.83
-0.11 (-0.18%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap18.40B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.48 | ||
| Fwd PE | 11.81 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.42% | ||
| ROE | 7.95% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 13.21% | ||
| PM (TTM) | 14.08% | ||
| GM | 76.35% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 4.5 | ||
| Quick Ratio | 4.5 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)19.22%
EPS 3Y16.09%
EPS 5Y
EPS growth Q2Q
EPS Next Y-2.77%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)3.06%
Revenue growth 3Y19.52%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y