Assessing Zoom (ZM) Valuation After AI Companion 3.0 and New Zoom for Defense Launches

Zoom Communications (ZM) just rolled out two big product moves: AI Companion 3.0 for everyday workflows and Zoom for Defense for high security government use, giving investors fresh angles on growth and durability.

See our latest analysis for Zoom Communications.

These launches build on a busy stretch for Zoom, where better than expected quarterly results and solid cash generation have underpinned a 9.15% 1 month share price return. However, the 5 year total shareholder return of negative 76.34% shows how long term holders are still waiting for a more meaningful recovery. Momentum is improving, but the broader rerating story is still very much in progress.

If AI driven collaboration is on your radar, this is also a good moment to see what else is gaining traction across high growth tech and AI stocks and compare potential opportunities.

With shares still trading at a near 28 percent discount to intrinsic value and a modest upside to analyst targets, are investors overlooking Zoom’s next leg of AI fueled growth, or is the market already pricing it in?

Most Popular Narrative: 6.2% Undervalued

With fair value estimates sitting modestly above the last close, this widely followed narrative argues Zoom still has room to re rate as its model evolves.

Strong and accelerating adoption of AI powered features such as AI Companion, Virtual Agent 2.0, and Contact Center Elite demonstrates growing customer reliance on advanced collaboration and productivity tools, positioning Zoom at the forefront of enterprise digital transformation; this is likely to expand the addressable market, drive multi year revenue growth, and increase recurring revenue stability.

Read the complete narrative.

Curious how modest revenue growth, shifting margins, and a higher future earnings multiple combine into that upside case? Want to see the full playbook behind this valuation call and the assumptions it makes about Zoom’s next chapter in enterprise AI?

Result: Fair Value of $94.58 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intensifying competition and slower than expected monetization of AI features could pressure growth assumptions and limit the multiple expansion that this narrative relies on.

Find out about the key risks to this Zoom Communications narrative.

Build Your Own Zoom Communications Narrative

If this perspective does not quite match your own, or you prefer digging into the numbers yourself, you can build a narrative in minutes: Do it your way

A great starting point for your Zoom Communications research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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