Zoom Video Communications (NASDAQ: ZM) is one of 59 public companies in the “Computer programming, data processing, & other computer related” industry, but how does it compare to its peers? We will compare Zoom Video Communications to related companies based on the strength of its analyst recommendations, dividends, valuation, risk, profitability, earnings and institutional ownership.

Profitability

This table compares Zoom Video Communications and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Zoom Video Communications 3.73% 3.30% 2.23%
Zoom Video Communications Competitors -4.23% -54.08% -3.57%

Insider and Institutional Ownership

22.6% of Zoom Video Communications shares are held by institutional investors. Comparatively, 52.8% of shares of all “Computer programming, data processing, & other computer related” companies are held by institutional investors. 14.7% of shares of all “Computer programming, data processing, & other computer related” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Zoom Video Communications and its peers revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Zoom Video Communications $622.66 million $21.75 million 1,534.56
Zoom Video Communications Competitors $8.32 billion $1.62 billion 43.79

Zoom Video Communications’ peers have higher revenue and earnings than Zoom Video Communications. Zoom Video Communications is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Zoom Video Communications and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Zoom Video Communications 2 14 8 0 2.25
Zoom Video Communications Competitors 959 3233 6427 319 2.56

Zoom Video Communications currently has a consensus price target of $98.78, suggesting a potential downside of 28.48%. As a group, “Computer programming, data processing, & other computer related” companies have a potential upside of 125.67%. Given Zoom Video Communications’ peers stronger consensus rating and higher probable upside, analysts plainly believe Zoom Video Communications has less favorable growth aspects than its peers.

Summary

Zoom Video Communications peers beat Zoom Video Communications on 8 of the 12 factors compared.

Zoom Video Communications Company Profile

Zoom Video Communications, Inc. provides a video-first communications platform that changes how people interact primarily in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. It connects people through frictionless video, voice, chat, and content sharing. The company's cloud-native platform enables face-to-face video experiences and connects users across various devices and locations in a single meeting. It serves education, entertainment/media, enterprise infrastructure, finance, healthcare, manufacturing, non-profit/not for profit and social impact, retail/consumer products, and software/Internet industries, as well as individuals. The company was formerly known as Zoom Communications, Inc. and changed its name to Zoom Video Communications, Inc. in May 2012. Zoom Video Communications, Inc. was founded in 2011 and is headquartered in San Jose, California.

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