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Jul 27, 2021
Zoom Video (ZM, $373.14) stock is a top pick at Bank of America

Zoom Video (ZM, $373.14) stock is a top pick at Bank of America

Shares of Zoom Video Communications  rose on Monday, after Bank of America made the stock its top pick following its deal to buy Five9.

Analyst Daniel Bartus said that Zoom and Five9 together would be the “strongest UCaaS/CCaaS (unified communications as a service/contact center as a service)  combination” in the market.

"While it is early for enterprises to consider UCaaS and CCaaS together, we believe the trend of bundling is increasing and the long-term value of integrating both technologies is attractive," Bartus noted.

Last week, Zoom announced the purchase of Five9 for just under $15 billion. Under the terms of the deal, investors in Five9 will get 0.55 of a Zoom share for each of their holdings, which represents a 12.8% premium to their Friday closing price and a 23 times multiple to Five9's projected 2022 sales of $650 million. According to the companies, the acquisition will expands Zoom's total addressable market by around $24 billion.

Bartus indicated that the combined entity will be a competitor  to  company like RingCentral and 8x8.

Related Ticker: ZM

ZM in upward trend: price expected to rise as it breaks its lower Bollinger Band on September 18, 2026

ZM may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In 29 of 35 cases where ZM's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are 83%.

Price Prediction Chart

Technical Analysis (Indicators)

Bullish Trend Analysis

The RSI Oscillator points to a transition from a downward trend to an upward trend -- in cases where ZM's RSI Indicator exited the oversold zone, 28 of 36 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 78%.

The Momentum Indicator moved above the 0 level on October 01, 2026. You may want to consider a long position or call options on ZM as a result. In 60 of 87 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 69%.

The Moving Average Convergence Divergence (MACD) for ZM just turned positive on October 01, 2026. Looking at past instances where ZM's MACD turned positive, the stock continued to rise in 27 of 40 cases over the following month. The odds of a continued upward trend are 68%.

Following a +6.16% 3-day Advance, the price is estimated to grow further. Considering data from situations where ZM advanced for three days, in 188 of 291 cases, the price rose further within the following month. The odds of a continued upward trend are 65%.

Bearish Trend Analysis

The Stochastic Oscillator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.

ZM moved below its 50-day moving average on September 09, 2026 date and that indicates a change from an upward trend to a downward trend.

The 10-day moving average for ZM crossed bearishly below the 50-day moving average on September 14, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 14 of 18 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 78%.

Following a 3-day decline, the stock is projected to fall further. Considering past instances where ZM declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 75%.

The Aroon Indicator for ZM entered a downward trend on October 05, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.

Fundamental Analysis (Ratings)

The Tickeron SMR rating for this company is 31 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.

The Tickeron Price Growth Rating for this company is 46 (best 1 - 100 worst), indicating steady price growth. ZM’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.

The Tickeron Valuation Rating of 75 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.253) is normal, around the industry mean (51.456). P/E Ratio (8.106) is within average values for comparable stocks, (82.636). Projected Growth (PEG Ratio) (2.393) is also within normal values, averaging (3.135). Dividend Yield (0.000) settles around the average of (0.011) among similar stocks. P/S Ratio (5.562) is also within normal values, averaging (69.875).

The Tickeron Seasonality Score of 85 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.

The Tickeron PE Growth Rating for this company is 97 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.

The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. ZM’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 94, placing this stock worse than average.

Notable companies

The most notable companies in this group are Salesforce (NYSE:CRM), Shopify Inc (NASDAQ:SHOP), Uber Technologies (NYSE:UBER), ServiceNow Inc. (NYSE:NOW), Datadog (NASDAQ:DDOG), Adobe (NASDAQ:ADBE), Intuit (NASDAQ:INTU), Workday (NASDAQ:WDAY), Atlassian Corp (NASDAQ:TEAM), Autodesk (NASDAQ:ADSK).

Industry description

Packaged software comprises multiple software programs bundled together and sold as a group. For example, Microsoft Office includes multiple applications such as Excel, Word, and PowerPoint. In some cases, buying a bundled product is cheaper than purchasing each item individually[s20] . Microsoft Corporation, Oracle Corp. and Adobe are some major American packaged software makers.

Market Cap

The average market capitalization across the Packaged Software Industry is 9.9B. The market cap for tickers in the group ranges from 39 to 244.09B. SAPGF holds the highest valuation in this group at 244.09B. The lowest valued company is STIXF at 39.

High and low price notable news

The average weekly price growth across all stocks in the Packaged Software Industry was 2%. For the same Industry, the average monthly price growth was -5%, and the average quarterly price growth was 12%. RPGL experienced the highest price growth at 180%, while WCT experienced the biggest fall at -87%.

Volume

The average weekly volume growth across all stocks in the Packaged Software Industry was -45%. For the same stocks of the Industry, the average monthly volume growth was 20% and the average quarterly volume growth was -37%

Fundamental Analysis Ratings

The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows

Valuation Rating: 53
P/E Growth Rating: 76
Price Growth Rating: 59
SMR Rating: 77
Profit Risk Rating: 94
Seasonality Score: 6 (-100 ... +100)
Related Portfolios: APPLICATION SOFTWARE
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General Information

a developer of video-first communications platform and application

Industry PackagedSoftware

Industry
Packaged Software
Address
55 Almaden Boulevard
Phone
+1 888 799-9666
Employees
7438
Web
https://www.zoom.com
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