Zoom Video Communications Inc. (NASDAQ: ZM) has announced that it will release its Q4 2021 earnings report on Monday, February 28, 2022, after market close.
What to look for: Zoom is putting people at the core of the company's communications platform, linking their diverse workstreams into Zoom Communication's technology, and empowering firms to engage face-to-face with their consumers via Zoom Events and the future Video Engagement Center. When the company released Q3 results, it demonstrated innovations like hot-desking, whiteboarding, and the smart gallery, all of which are geared to benefit both remote hybrid and co-located workforces.
Earnings: Stockearnings Estimated EPS is expected to be around $0.67 for Q4 2022. In the third quarter, GAAP net income attributable to shareholders was $340.3 million or $1.11 per share whole non-GAAP net income was $338.4 million or $1.11 per share, topping estimates of $1.09 per share. Analysts expect the company to report EPS of $3 for fiscal 2022 and EPS of $3 in fiscal 2023. Historical EPS Performance shows that in the past 12 quarters, the company has topped estimates eleven times (100%).
Revenue: In the third quarter, the company reported revenue of $1.05 billion, beating analysts' projections of $1.02 billion, representing YoY growth of 35.2%. The company had a net margin of 29.28%. The company expects full-year revenue to be between $4.079 billion and $4.081 billion, representing YoY growth of 50%.
Stock movement: Zoom Communication shares have lost 47.6% since the company released its Q3 2022 earnings. Interestingly, the company’s shares have been DOWN 7 times out of the past 12 quarters. So, the historical price reaction suggests a 63% probability of the share price going DOWN following the fiscal Q4 2022 earnings release. According to the Stockearning algorithm, the predicted volatility on the first day is +/-10%, while the predicted volatility on the seventh day is +/-10%.
What analysts are saying: CICC commenced coverage on Zoom Video Communication with a buy rating and a price target of $182.92. Citici Securities analyst Junyun Chen commenced coverage in zoom Video Communication with a Buy rating and a price target of $260. However, the analyst believes the stock is "oversold" at current prices, citing slowing sales growth and market fears about growing competition.
Goldman Sachs’ Kash Rangan assumed coverage of ZM with a Hold rating and price target of $200. The analyst began coverage on the collaboration and communication category with a good sector outlook. In a research note, Rangan told investors that the $19 billion cloud total potential market in 2020 indicates a cloud presence of 7% in 2020, rising to 29% in 2025. According to the analyst, Zoom Video is among the few software businesses flourishing in consumer and enterprise markets. However, the company is now competing against itself.
Wells Fargo’s Michael Turrin slashed his price target on the stock from $245 to $200, reflecting multiple compression in the software space. However, the analyst is maintaining a Hold rating on the share.
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