Zoom Communications (NASDAQ:ZM) Shares Gap Down After Analyst Downgrade

Zoom Communications, Inc. (NASDAQ:ZM) shares gapped down prior to trading on Thursday after Sanford C. Bernstein lowered their price target on the stock from $90.00 to $88.00. The stock had previously closed at $85.43, but opened at $79.00. Sanford C. Bernstein currently has a market perform rating on the stock. Zoom Communications shares last traded at $74.4240, with a volume of 3,295,743 shares traded.

Other equities research analysts have also issued reports about the company. Needham & Company LLC reaffirmed a “buy” rating and set a $100.00 target price on shares of Zoom Communications in a research report on Tuesday, November 25th. JPMorgan Chase & Co. lifted their price target on Zoom Communications from $85.00 to $90.00 and gave the stock a “neutral” rating in a research note on Tuesday, November 25th. Piper Sandler boosted their price objective on Zoom Communications from $85.00 to $91.00 and gave the stock a “neutral” rating in a report on Monday, January 5th. Benchmark decreased their target price on shares of Zoom Communications from $115.00 to $110.00 and set a “buy” rating for the company in a report on Tuesday. Finally, Weiss Ratings reissued a “buy (b-)” rating on shares of Zoom Communications in a research report on Monday, December 29th. Fourteen equities research analysts have rated the stock with a Buy rating, twelve have assigned a Hold rating and one has given a Sell rating to the company’s stock. Based on data from MarketBeat.com, Zoom Communications has a consensus rating of “Hold” and an average target price of $95.32.

Insider Activity

In other news, CEO Eric S. Yuan sold 73,378 shares of the business’s stock in a transaction on Tuesday, December 16th. The shares were sold at an average price of $87.29, for a total transaction of $6,405,165.62. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, CFO Michelle Chang sold 8,417 shares of the company’s stock in a transaction on Monday, January 12th. The stock was sold at an average price of $86.54, for a total transaction of $728,407.18. Following the completion of the transaction, the chief financial officer directly owned 25,482 shares in the company, valued at $2,205,212.28. This trade represents a 24.83% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold a total of 183,089 shares of company stock valued at $15,751,383 in the last three months. 11.51% of the stock is currently owned by insiders.

Zoom Communications News Roundup

Here are the key news stories impacting Zoom Communications this week:

• Positive Sentiment: Enterprise momentum and revenue beat — Q4 revenue was about $1.25B, up ~5.3% YoY with enterprise revenue rising ~7% and more large customers (> $100k) year‑over‑year, providing a healthier top‑line backdrop. Zoom Communications Reports Fourth Quarter and Fiscal Year 2026 Financial Results
• Positive Sentiment: New AI product and execution — Zoom launched Zoom Virtual Agent 3.0 to expand AI‑driven customer service automation, reinforcing its strategy to monetize AI and deepen enterprise ties. Zoom introduces next-gen Zoom Virtual Agent to automate end-to-end customer resolution
• Positive Sentiment: Capital returns and margin progress — management completed a $2.7B buyback program and reported margin expansion and shifting cash flow dynamics that support shareholder returns. Zoom (ZM) Is Down 6.2% After Strong FY26 Results, New AI Launch And Buyback Completion
• Neutral Sentiment: Full disclosure materials available — investors can review the earnings slide deck and the full earnings call transcript for details on metrics, customer composition and FY27 assumptions. Zoom Q4 Results – Earnings Call Presentation
• Negative Sentiment: EPS miss — non‑GAAP EPS came in at $1.44, a few cents below Street consensus (roughly $1.48–$1.49), which undercut the stock despite the revenue beat. Zoom Q4 Earnings Miss Estimates, Revenues Increase Y/Y
• Negative Sentiment: Softer near‑term profit outlook and analyst concern — several outlets and analysts highlighted guidance and commentary that imply tougher quarterly profit comparisons and prompted reviews of EPS trajectories, sparking downward pressure. Zoom forecasts quarterly profit below estimates amid tough competition
• Negative Sentiment: Mixed analyst moves — several firms adjusted ratings/targets after the print (Sanford Bernstein trimmed its target; others issued divergent price targets), adding to intraday volatility and driving some selling. Zoom tumbles after mixed Q4, analysts mull softer EPS outlook

Institutional Investors Weigh In On Zoom Communications

Several institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Vanguard Group Inc. boosted its stake in Zoom Communications by 4.0% during the 4th quarter. Vanguard Group Inc. now owns 26,967,224 shares of the company’s stock valued at $2,327,002,000 after purchasing an additional 1,029,623 shares during the period. AQR Capital Management LLC increased its position in Zoom Communications by 43.9% in the 4th quarter. AQR Capital Management LLC now owns 12,195,243 shares of the company’s stock worth $1,052,328,000 after buying an additional 3,718,186 shares during the period. State Street Corp lifted its holdings in shares of Zoom Communications by 5.0% during the fourth quarter. State Street Corp now owns 7,582,924 shares of the company’s stock worth $654,331,000 after buying an additional 363,776 shares during the last quarter. Norges Bank bought a new stake in shares of Zoom Communications in the second quarter valued at approximately $539,998,000. Finally, Geode Capital Management LLC boosted its position in shares of Zoom Communications by 3.1% in the fourth quarter. Geode Capital Management LLC now owns 5,139,583 shares of the company’s stock valued at $445,254,000 after acquiring an additional 152,862 shares during the period. 66.54% of the stock is currently owned by institutional investors and hedge funds.

Zoom Communications Price Performance

The firm’s 50 day moving average price is $87.95 and its 200-day moving average price is $84.36. The firm has a market cap of $22.37 billion, a price-to-earnings ratio of 12.18, a P/E/G ratio of 7.65 and a beta of 0.90.

Zoom Communications (NASDAQ:ZM) last posted its quarterly earnings results on Wednesday, February 25th. The company reported $1.44 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.48 by ($0.04). Zoom Communications had a return on equity of 12.13% and a net margin of 39.03%.The company had revenue of $1.25 billion during the quarter, compared to analyst estimates of $1.23 billion. During the same quarter in the prior year, the business earned $1.41 earnings per share. The business’s revenue for the quarter was up 5.3% on a year-over-year basis. Zoom Communications has set its FY 2027 guidance at 5.770-5.810 EPS and its Q1 2027 guidance at 1.400-1.420 EPS. Analysts expect that Zoom Communications, Inc. will post 2.93 EPS for the current year.

Zoom Communications Company Profile

Zoom Video Communications, Inc (commonly referred to as Zoom) is a provider of cloud-based communications and collaboration solutions. The company’s platform supports video conferencing, voice calling, instant messaging, webinars and large-scale virtual events, and meeting room systems, marketed to businesses, educational institutions, government organizations and individual users. Zoom’s product lineup includes Zoom Meetings, Zoom Phone, Zoom Rooms, Zoom Video Webinars and Zoom Chat, and the company offers integrations and extensions through a developer marketplace and third-party apps.

Founded in 2011 by Eric S.