Zoom Communications, Inc. · Software - Application
FCF$2.0bC+
Rev+5.0%C+
D/E0.01A
P/E15.8xA-
PEG4.21D
56.1Score
$107.20$31.4B
1Y Target$115.00Analyst consensus · 26 analysts
5Y Target$168.37Compound horizon
10Y Target$249.77Long-dated conviction
FCF$2.0bTTMC+
FCF $2.0b — respectable but not differentiating
Rev+5.0%TTM YoYC+
Revenue +5.0% — steady but below market-beating range
D/E0.01A
D/E 0.01 — least levered decile in Technology (≈10th pctile)
P/E15.8xA-
P/E 15.8 — cheaper than most Technology peers (≈25th pctile)
PEG4.21D
PEG 4.21 — very expensive; pricing in best-case scenarios
Forward price target — the 1-year figure is the analyst consensus where the stock is covered; the 5- and 10-year figures compound our earnings estimate from there. The DCF below is a separate cross-check on intrinsic value (what it's worth today), not another target.
Quality-growth score · 56.1
Quality0.81
Growth0.46
Value0.47
Why this score
Buying back stock
Entry · Margin of safety
52-week rangeNear 52-week high
7% off the 12-month high
vs DCF fair value11% aboveest. fair value ~$97
What the price assumes: free cash flow compounding at ~6% a year for the next decade — vs the ~4% a year our model projects from current growth and analyst estimates.
Quality signals · context only
Gross profitability31% · B+gross profit ÷ total assets (Novy-Marx)
ROIC9.4% · Breturn on invested capital — not score-weighted
Model-generatedGenerated by the Bull Rankings model from this company's reported fundamentals, and checked against the figures shown above.
Why now
Software - Application · market cap $31.4b. 7% off the 52-week high of $114.74. 26 sell-side analysts rate this a Buy with a mean 1-yr target of $115.00 (implying +7% upside).
Moat
Net margin 42% is exceptional — pricing-power territory rare outside premium software, branded staples, and specialty pharma. ROE 21% sits above Buffett's preferred 15% threshold — the equity base is compounding at a rate the market struggles to discount accurately. Software economics — recurring revenue, embedded customer workflows, and high gross margin all compound the moat once a base account is won. Switching costs are the lever.
Risk
Software — competitive moat is durable until it isn't; watch net revenue retention, gross margin trends, and any new market entrant with a fundamentally lower price point.
Horizon
1-3 yr $115.00 (26-analyst consensus) — fundamentals + valuation re-rating. 5 yr $168.37 at ~9% CAGR — compounding case rests on the competitive position widening. 10 yr $249.77 if current growth sustains into durable earnings power.
Not investment advice. The Bull Rankings publishes a quantitative ranking model and accompanying analysis for general informational purposes only. Nothing on this page is a recommendation to buy, sell, or hold any security; nothing is personalized to your circumstances, risk tolerance, or tax situation. Investing carries the risk of loss — invest at your own risk and consider consulting a licensed financial professional before acting on anything you read here. See terms and methodology for full disclosures.
ZM vs the Top Picks average
Pillar
ZM
Book avg
Diff
Quality
0.81
0.83
-0.03
Growth
0.46
0.92
-0.46
Value
0.47
0.75
-0.27
Averaged across the 30 names in today's Top Picks (mean score 82.4). A name can beat these averages and still be absent from the book — it also applies concentration limits.
Score history · ZM
Trend
-1.6 over 37 daily scores
From 57.7 (Jun 22) → 56.1 (now)
One point per daily model run. The range autoscales, so a flat-looking line can still hide 1–2 point moves — read the From → To values for the actual range.
Position sizing · ZM
$
%
%
Shares to buy
18
Position size
$1,930
3.9% of portfolio
Stop price
$80.40
25% below $107.20
$ at risk if stopped
$482.40
budget $500.00 · 1% of portfolio
Math only — share count is floor(portfolio × risk% ÷ (price × stop%)). Doesn't account for commissions, slippage, gap risk, or position-correlation across your book. Inputs persist locally; never sent to the server. Not investment advice.
Zoom Communications, Inc. (ZM): score, valuation & FAQ
Zoom Communications, Inc. (ZM) is a Software - Application company that scores 56.1 out of 100 on the Bull Rankings quality-growth model — a middling reading. The score blends three pillars — quality (durable returns, healthy margins, low leverage), growth (revenue and earnings), and value (valuation versus sector peers) — into one number, refreshed daily; it is a screen, not a buy recommendation.
Its strongest graded signals are D/E (A) and P/E (A-), while PEG (D) rate weaker. On valuation, ZM sits about 11% above our discounted-cash-flow fair value — the current price implies roughly 6% annual free-cash-flow growth over the next decade.
Is ZM a good stock to buy?
Bull Rankings scores ZM 56.1 out of 100 on its quality-growth model, which is a middling reading. That is driven by D/E (A) and P/E (A-). A score is a quantitative screen of Zoom Communications, Inc.'s fundamentals, not personalised financial advice — weigh it against your own time horizon and risk tolerance, and read the risk factors below before acting.
Why does ZM score 56.1 on Bull Rankings?
The quality-growth score blends three pillars — quality (returns on capital, margins, leverage, earnings quality), growth (revenue and earnings expansion), and value (valuation versus sector peers). ZM earns its highest marks on D/E (A) and P/E (A-), and is held back by PEG (D). Each pillar is graded against sector-aware thresholds, then combined into the single 0–100 score.
Is ZM overvalued or undervalued?
Based on $107.20, ZM sits about 11% above our discounted-cash-flow fair value — the current price implies roughly 6% annual free-cash-flow growth over the next decade. It trades at a 15.8x× P/E (graded A-). Discounted-cash-flow estimates are sensitive to growth and discount-rate assumptions, so treat this as a cross-check, not a price target.
What are the main risks of investing in ZM?
Software — competitive moat is durable until it isn't; watch net revenue retention, gross margin trends, and any new market entrant with a fundamentally lower price point.
Bull Rankings is an automated fundamentals screen for research and education. It is not investment advice, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a licensed financial adviser.