What's Going On With Zoom Video Stock Tuesday?

Zoom Video Communications Inc ZM shares are trading higher Tuesday after the company reported better-than-expected quarterly results and issued strong earnings guidance. Several analysts are out with updates following the print.

What Happened: Zoom said second-quarter revenue increased 3.6% year-over-year to $1.14 billion, which beat the consensus estimate of $1.11 billion, according to Benzinga Pro. The communications company reported quarterly adjusted earnings of $1.34 per share, which beat analyst estimates of $1.03 per share, marking the 17th consecutive EPS beat for Zoom. 

Operating cash flow came in at $336 million, up 30.6% year-over-year. Zoom ended the quarter with approximately 218,200 enterprise customers, up 6.9% year-over-year. 

"Our mission of delivering limitless human connection remains core as we continue to innovate and expand our platform to help bring value and enhanced productivity to our customers with new AI features like Zoom IQ Meeting Summary and Team Chat Compose, as well as Intelligent Director," said Eric Yuan, founder and CEO of Zoom.

Zoom said it expects third-quarter revenue to be between $1.115 billion and $1.12 billion versus estimates of $1.13 billion. The company expects third-quarter earnings to be between $1.07 and $1.09 per share versus estimates of $1.03 per share. 

Full-year revenue is expected to be between $4.485 billion and $4.495 billion versus estimates of $4.48 billion. Full-year earnings are expected to be between $4.63 and $4.67 per share versus estimates of $4.30 per share.

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Analyst Assessment:

  • Rosenblatt analyst Catharine Trebnick reiterated Zoom with a Neutral and maintained a $75 price target.
  • Bernstein analyst Peter Weed maintained Zoom with a Market Perform and lowered the price target from $92 to $82.
  • Wells Fargo analyst Michael Turrin maintained Zoom with an Equal-Weight and lowered the price target from $80 to $75.
  • Baird analyst William Power maintained Zoom with an Outperform and lowered the price target from $95 to $90.
  • RBC Capital analyst Rishi Jaluria reiterated Zoom with an Outperform and maintained a $95 price target.
  • Mizuho analyst Siti Panigrahi reiterated Zoom with a Buy and maintained a $100 price target.

ZM Price Action: Zoom shares were up 1.09% at $68 at the time of publication, according to Benzinga Pro.

Photo: courtesy of Zoom.

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