Zoom Communications (NASDAQ:ZM) Shares Gap Down on Analyst Downgrade

Zoom Communications, Inc. (NASDAQ:ZM) shares gapped down prior to trading on Thursday after BTIG Research lowered their price target on the stock from $105.00 to $100.00. The stock had previously closed at $85.43, but opened at $79.00. BTIG Research currently has a buy rating on the stock. Zoom Communications shares last traded at $74.4240, with a volume of 3,295,743 shares trading hands.

Several other research analysts have also recently weighed in on the stock. Wall Street Zen cut shares of Zoom Communications from a “strong-buy” rating to a “buy” rating in a research note on Saturday, November 15th. Cantor Fitzgerald restated a “neutral” rating and issued a $87.00 price target on shares of Zoom Communications in a research report on Tuesday, November 25th. Piper Sandler increased their target price on shares of Zoom Communications from $85.00 to $91.00 and gave the stock a “neutral” rating in a report on Monday, January 5th. Citizens Jmp reiterated a “market perform” rating on shares of Zoom Communications in a research report on Tuesday. Finally, Benchmark decreased their price objective on shares of Zoom Communications from $115.00 to $110.00 and set a “buy” rating on the stock in a research report on Tuesday. Fourteen research analysts have rated the stock with a Buy rating, twelve have assigned a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat.com, the company presently has a consensus rating of “Hold” and a consensus target price of $95.41.

Insider Activity

In other Zoom Communications news, insider Velchamy Sankarlingam sold 7,568 shares of the firm’s stock in a transaction that occurred on Monday, January 12th. The stock was sold at an average price of $86.55, for a total transaction of $655,010.40. Following the completion of the transaction, the insider owned 136,182 shares in the company, valued at $11,786,552.10. This trade represents a 5.26% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available through this link. Also, CFO Michelle Chang sold 8,417 shares of the company’s stock in a transaction that occurred on Monday, January 12th. The stock was sold at an average price of $86.54, for a total value of $728,407.18. Following the sale, the chief financial officer directly owned 25,482 shares in the company, valued at $2,205,212.28. This trade represents a 24.83% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders have sold 183,089 shares of company stock valued at $15,751,383. 11.51% of the stock is owned by corporate insiders.

Zoom Communications News Summary

Here are the key news stories impacting Zoom Communications this week:

• Positive Sentiment: Completed $2.7 billion share-repurchase program, which reduces float and supports EPS and valuation; this corporate action is a clear buyback tailwind for shareholders. Read More.
• Positive Sentiment: Launched Zoom Virtual Agent 3.0 — an upgraded AI customer?service automation product that can drive enterprise upsells and deepen stickiness of Zoom’s platform. Read More.
• Positive Sentiment: Reported revenue above Street estimates and continued enterprise revenue growth (Q4 total revenue ~$1.25B; enterprise revenue up ~7% YoY), showing demand resilience in higher?value customers. Read More.
• Positive Sentiment: Rosenblatt reaffirmed a “buy” rating with a $115 price target, signaling some analysts see significant upside from current levels. Read More.
• Neutral Sentiment: Citizens Jmp reiterated a “market perform” rating, reflecting mixed analyst views on near?term growth vs. longer?term opportunity. Read More.
• Neutral Sentiment: Full Q4 earnings materials and call transcript are available for deeper inspection — useful for investors who want detail on customer cohorts, margins and guidance assumptions. Read More.
• Negative Sentiment: Non?GAAP EPS missed consensus (reported $1.44 vs. ~$1.48 expected) and some headlines flagged weaker profit guidance, which pressured sentiment after the print. Read More.
• Negative Sentiment: Management warned about margin/earnings pressure from intense competition (Microsoft Teams, Google Meet) and slower consumer demand, a structural headwind that may constrain growth and multiples. Read More.
• Negative Sentiment: Market reaction was negative (shares fell notably after the report), reflecting investor concern that the near?term profitability/growth trajectory is weaker than hoped despite longer?term AI and buyback positives. Read More.

Institutional Inflows and Outflows

A number of hedge funds have recently bought and sold shares of the company. Vanguard Group Inc. grew its holdings in Zoom Communications by 4.0% during the 4th quarter. Vanguard Group Inc. now owns 26,967,224 shares of the company’s stock valued at $2,327,002,000 after purchasing an additional 1,029,623 shares during the last quarter. AQR Capital Management LLC raised its holdings in shares of Zoom Communications by 43.9% in the fourth quarter. AQR Capital Management LLC now owns 12,195,243 shares of the company’s stock worth $1,052,328,000 after buying an additional 3,718,186 shares during the period. State Street Corp raised its holdings in shares of Zoom Communications by 5.0% in the fourth quarter. State Street Corp now owns 7,582,924 shares of the company’s stock worth $654,331,000 after buying an additional 363,776 shares during the period. Norges Bank purchased a new position in Zoom Communications during the 2nd quarter valued at $539,998,000. Finally, Geode Capital Management LLC grew its position in Zoom Communications by 3.1% in the 4th quarter. Geode Capital Management LLC now owns 5,139,583 shares of the company’s stock valued at $445,254,000 after acquiring an additional 152,862 shares during the last quarter. Institutional investors own 66.54% of the company’s stock.

Zoom Communications Stock Down 11.5%

The firm has a market cap of $22.39 billion, a PE ratio of 14.71, a price-to-earnings-growth ratio of 7.84 and a beta of 0.90. The business has a 50 day simple moving average of $88.22 and a two-hundred day simple moving average of $84.43.

Zoom Communications (NASDAQ:ZM) last posted its quarterly earnings results on Monday, November 24th. The company reported $1.52 EPS for the quarter, topping analysts’ consensus estimates of $1.44 by $0.08. Zoom Communications had a net margin of 33.17% and a return on equity of 12.20%. The firm had revenue of $1.23 billion for the quarter, compared to analysts’ expectations of $1.21 billion. During the same period in the prior year, the business posted $1.38 earnings per share. The business’s revenue for the quarter was up 4.4% on a year-over-year basis. Equities analysts forecast that Zoom Communications, Inc. will post 2.93 earnings per share for the current year.

About Zoom Communications

Zoom Video Communications, Inc (commonly referred to as Zoom) is a provider of cloud-based communications and collaboration solutions. The company’s platform supports video conferencing, voice calling, instant messaging, webinars and large-scale virtual events, and meeting room systems, marketed to businesses, educational institutions, government organizations and individual users. Zoom’s product lineup includes Zoom Meetings, Zoom Phone, Zoom Rooms, Zoom Video Webinars and Zoom Chat, and the company offers integrations and extensions through a developer marketplace and third-party apps.

Founded in 2011 by Eric S.