Zoom Communications Inc.

XTRA:5ZM Stock Report

Market Cap: €24.2b

Zoom Communications Valuation

Is 5ZM undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of 5ZM when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 5ZM (€80.33) is trading below our estimate of fair value (€139.55)

Significantly Below Fair Value: 5ZM is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 5ZM?

Key metric: As 5ZM is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for 5ZM. This is calculated by dividing 5ZM's market cap by their current earnings.
What is 5ZM's PE Ratio?
PE Ratio27.2x
EarningsUS$941.21m
Market CapUS$25.56b

Price to Earnings Ratio vs Peers

How does 5ZM's PE Ratio compare to its peers?

The above table shows the PE ratio for 5ZM vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average54.2x
NEM Nemetschek
65.6x18.6%€11.2b
SAP SAP
93.3x40.7%€256.1b
TMV TeamViewer
14.7x11.1%€1.7b
AOF ATOSS Software
43.2x7.8%€1.9b
5ZM Zoom Communications
27.2x2.7%€25.6b

Price-To-Earnings vs Peers: 5ZM is good value based on its Price-To-Earnings Ratio (27.2x) compared to the peer average (54.2x).

Price to Earnings Ratio vs Industry

How does 5ZM's PE Ratio compare vs other companies in the European Software Industry?

6 CompaniesPrice / EarningsEstimated GrowthMarket Cap
5ZM 27.2xIndustry Avg. 27.0xNo. of Companies19PE020406080100+
6 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: 5ZM is expensive based on its Price-To-Earnings Ratio (27.2x) compared to the European Software industry average (27x).

Price to Earnings Ratio vs Fair Ratio

What is 5ZM's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

5ZM PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio27.2x
Fair PE Ratio30.9x

Price-To-Earnings vs Fair Ratio: 5ZM is good value based on its Price-To-Earnings Ratio (27.2x) compared to the estimated Fair Price-To-Earnings Ratio (30.9x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst 5ZM forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
Current€80.33
€85.74
+6.7%
9.8%€108.74€66.19n/a27
Nov ’25€69.90
€70.87
+1.4%
12.1%€87.73€55.41n/a26
Oct ’25€62.13
€68.85
+10.8%
12.4%€86.06€54.35n/a26
Sep ’25€62.37
€67.62
+8.4%
12.2%€84.88€53.61n/a26
Aug ’25€56.48
€69.88
+23.7%
13.0%€87.50€50.66n/a26
Jul ’25€55.23
€71.26
+29.0%
12.6%€88.73€51.37n/a26
Jun ’25€55.79
€70.83
+27.0%
11.9%€87.79€53.60n/a26
May ’25€57.77
€73.52
+27.3%
11.8%€89.03€51.55n/a27
Apr ’25€61.23
€73.23
+19.6%
11.9%€88.45€51.21n/a26
Mar ’25€64.97
€73.13
+12.6%
11.9%€87.67€50.75n/a25
Feb ’25€59.29
€73.88
+24.6%
13.7%€96.62€55.21n/a25
Jan ’25€66.17
€74.92
+13.2%
13.0%€97.55€62.24n/a25
Dec ’24€64.06
€73.84
+15.3%
13.1%€96.44€61.54n/a25
Nov ’24€56.86
€78.66
+38.3%
12.1%€99.87€62.77€69.9025
Oct ’24€66.53
€77.91
+17.1%
11.8%€98.67€62.02€62.1325
Sep ’24€66.93
€76.17
+13.8%
12.2%€96.65€60.75€62.3724
Aug ’24€66.20
€74.33
+12.3%
12.8%€93.74€58.03€56.4824
Jul ’24€62.17
€77.39
+24.5%
12.7%€97.57€60.40€55.2324
Jun ’24€62.75
€78.16
+24.6%
12.2%€97.87€60.59€55.7925
May ’24€55.56
€78.42
+41.1%
10.9%€96.85€62.72€57.7726
Apr ’24€67.80
€78.42
+15.7%
10.9%€96.85€62.72€61.2326
Mar ’24€66.61
€80.75
+21.2%
10.8%€98.48€63.78€64.9725
Feb ’24€68.18
€77.42
+13.6%
11.1%€95.58€60.99€59.2926
Jan ’24€63.17
€81.41
+28.9%
12.2%€102.96€62.71€66.1726
Dec ’23€77.00
€83.16
+8.0%
12.0%€104.50€63.65€64.0625
Nov ’23€84.44
€103.88
+23.0%
16.9%€133.65€71.97€56.8625

Analyst Forecast: Target price is less than 20% higher than the current share price.

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