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Pandemic Champion Zoom will be back!In this work, I will analyze Zoom Video Communications, Inc., a leading company in the cloud communication and collaboration sector, which offers online videoconferencing, chat, telephony, webinars, among other services, for different segments and audiences. My investment thesis is that Zoom is an innovative and profitable company that has the potential to remain a leading video-based unified communications platform well into the future. To support this thesis, I will evaluate the qualitative and quantitative aspects of the company. In the qualitative part, I will describe Zoom's business model and strategy, showing how it differs from its competitors, what are its strengths and weaknesses, the opportunities and threats it faces in the global market. In the quantitative part, I will present Zoom's financial and operational data, demonstrating how it has grown in recent years, and what its projections are for the future, for a well-structured technical analysis based on Wyckoff, structures and volume delta. _____ _____ _____ Company History The company emerged in 2011, as a result of the vision of Eric Yuan, a former engineer at Cisco Systems, who recognized the need to create a simpler, reliable, and high-quality communication platform. The company launched its main product, Zoom Meeting, in 2013, and has since been growing rapidly in terms of customers, revenue, and profit. The company went public on the NASDAQ stock exchange in April 2019, with an initial public offering (IPO) of $36 per share. In June 2019, the company became part of the Russell 2000 index, which comprises smaller-cap companies in the United States. In April 2020, the company was promoted to the Russell 1000 index, which includes larger-cap companies in the United States. In august 2020, the company surpassed a market value of $100 billion, becoming one of the most valuable technology companies in the world. Company's Sector of Operation The company operates in the software as a service (SaaS) sector, which is a business model that provides information technology solutions over the internet, without the need for customers to install or maintain hardware or software. The SaaS sector is a growing and competitive industry, benefiting from digitization, mobility, and cloud trends. Within the SaaS sector, the company excels in the cloud communication and collaboration (CCaaS) segment, which offers online services to facilitate remote work, distance education, and social interactions. The CCaaS segment is dynamic and innovative, adapting to technological changes and consumer demands. It is also a challenging and regulated segment, facing competition from major market players like Microsoft Teams, Google Meet, Cisco Webex, and Skype. Diversification and Innovation Strategy The company's strategy is to diversify and innovate its products and services to meet customer needs and differentiate itself from competitors. The company aims to become an open and flexible platform that integrates various cloud communication and collaboration solutions. Some examples of products and services that the company has launched or acquired in recent years include: Zoom Phone: a cloud telephony system that allows users to make and receive calls using the same Zoom Meeting application. Zoom Rooms: an integrated system that transforms any physical space into a virtual meeting room with video, audio, and screen sharing. Zoom Webinar: an online service that enables users to host virtual events with up to 50,000 participants and 100 speakers. Zoom Chat: an online service that allows users to exchange instant messages with other Zoom users or external contacts. OnZoom: an online platform that allows users to create, host, and monetize interactive virtual events, such as classes, shows, workshops. Kites: a startup specialized in real-time automatic translation for video conferences. SWOT Analysis It is an essential tool for evaluating a company to invest in, as it offers a broad and organized view of the company's current situation. It consists of identifying the Strengths, Weaknesses, Opportunities, and threats that affect the company's performance. This is a qualitative analysis and does not replace technical or fundamental analysis. The company's SWOT analysis is as follows: Strong points: Freemium model: Zoom offers a free basic plan that allows up to 100 participants and unlimited sessions of up to 40 minutes, attracting those looking for an affordable and quality solution for online communication. Ease of use: It is known for its simple and intuitive interface, which allows participants to start and join sessions with just a few clicks. The company also offers features such as virtual backgrounds and video retouching to enhance the look and feel of those involved during sessions. Global Usage: The platform has a global presence, with more than 300 million daily session participants and more than 213,000 enterprise customers worldwide. It also supports multiple languages and currencies, meeting the needs of diverse audiences. Financial strength: The company has experienced significant revenue and profit growth in recent years, driven by the high demand for online communication during the COVID-19 pandemic. Zoom's total revenue for fiscal 2023 was $4,393 billion, up 7% year-over-year. Business revenue was US$2.409 billion, an increase of 24% compared to the previous year. Brand name: The solution has become a household name and synonymous with online communication, thanks to its popularity and recognition among consumers. Zoom has also received several awards and recognition for its quality and innovation, such as the Webby Award for Best Mobile App in 2020. Weak points: Security issues: The company has faced many security and privacy issues in the past, such as “zoom bombing”, which is the unauthorized invasion of sessions by malicious people who interrupt or share inappropriate content. It has also been criticized for sharing consumer data with third parties without proper consent. They don't offer end-to-end encryption: Despite claiming to offer end-to-end encryption, the platform actually uses a type of encryption that allows the company to access session data if it wants to. This raises concerns about the confidentiality and integrity of participant communications. Zoom Rooms: Zoom rooms are a feature that allows stakeholders to create dedicated physical spaces for online communication using specialized Zoom or partner hardware. However, this feature is expensive and requires an additional monthly subscription, which may limit its adoption among customers. Opportunities: Growing demand: Demand for online communication is set to continue to grow in the future as more people embrace remote work and hybrid work models. The company can capitalize on this opportunity by expanding its customer base and offering customized solutions for different industries and needs. Up-selling: It can increase its revenue by encouraging basic plan consumers to upgrade to paid plans, which offer more features and benefits, such as longer sessions, more participants, recording and cloud storage, Zoom Phone and Zoom Rooms. Diversification: The platform can diversify its offer of products and services, exploring new markets and segments, such as health, education, entertainment, and e-commerce. The company can also develop new technologies and features, such as augmented reality, artificial intelligence and machine translation, to improve the user experience and differentiate itself from the competition. Threats: Intense competition: The company faces strong competition from other players in the online communication market, such as Microsoft Teams, Google Meet, Cisco Webex, Skype, and Facebook Messenger. These competitors have greater financial, technological and marketing resources than it does and can offer integrated and competitive solutions to customers. Regulatory changes: The platform is subject to various laws and regulations in different countries and regions, which may affect its operations and revenues. For example, it may face restrictions or bans from operating in certain markets due to national security, data privacy or human rights concerns. The company may also face fines or penalties for violating these laws and regulations. Dependence on network infrastructure: The quality and performance of Zoom services depend on the availability and reliability of network infrastructure, such as bandwidth, internet speed and stability. Any interruption or degradation of these factors could negatively impact the user experience and the reputation of the solution. Final qualitative analysis opinion ZM benefits from its freemium model, ease of use, global usage, financial strength and brand name. But, it also faces challenges such as security issues, lack of end-to-end encryption, cost of Zoom rooms, intense competition, regulatory changes and dependence on network infrastructure. The company can take advantage of videoconferencing demand growth, up-selling and diversification opportunities to overcome its weaknesses and threats. The platform must invest in improving its security and privacy, innovating its products and services and expanding its presence in new markets and segments. Zoom has the potential to remain one of the leading video-based unified communications solutions in the future. _____ _____ _____ Fundamental Analysis: We will introduce fundamental analysis, focusing on the company's financial health and performance. For this, we will use financial data from the second quarter of the fiscal year 2024 (ended on July 31, 2023). The financial indicators we will consider are: EBITDA, CFO, ROE, ROIC, Gross Margin, and Operating Margin. Description of fundamentals: Source: Yahoo Finance The company has good liquidity, as it has a high ratio of liquid assets in relation to liquid liabilities, which indicates a low default rate on its basic obligations and low default rates. Furthermore, the company has a large loss in relation to equity and this further reduces its potential market value. Source: Yahoo Finance The company has excellent financial health and strong performance. The company demonstrates high operating profit (EBITDA), good cash generation (CFO), good return on equity (ROE) and invested capital (ROIC), and good gross and operating margins. These results show that the company is efficient, profitable, sustainable, and competitive in the video conferencing and online collaboration market. Other Fundamentals indicators We will address other economic indicators that are not as necessary but can be incorporated into our fundamental analysis. Source: Yahoo Finance The data in this table shows that the company has a good financial performance, but also faces some problems. For one, Zoom Meeting has a high P/E Ratio, which indicates that investors expect future earnings growth from the company. Zoom Meeting also has a high Enterprise Value, which represents the company's total value in the market. These indicators suggest that Zoom Meeting is a successful and innovative company, offering a high-quality and in-demand communication service. On the other hand, Zoom Meeting has a low P/B Ratio and a low PSR, which indicate that the company is trading at a price well above its book value and sales. This could mean that Zoom Meeting is overvalued or faces strong competition in its industry. Furthermore, Zoom Meeting does not pay dividends to its shareholders, which may discourage some investors looking for a stable and secure income. These indicators propose that Zoom Meeting is a risky and volatile company that depends heavily on market expectations and industry trends. Final opinion of fundamental analysis It has significant potential for growth and generating value for shareholders, especially in a scenario of increased demand for digital solutions, but it needs to face the threats mentioned previously in the company's SWOT analysis. . Technical Analysis To begin the study, first, we observe that the stock was launched in April 2019, and in January 2020, there was a significant increase, as we can see in the weekly chart. With this, we will divide this technical analysis into three parts. In this chart, we have the presence of three volume profiles. It calculates volume by price level based on the Gaussian curve and is excellent for measuring long-term position buildups, especially in a weekly chart like this. Analysis of the first profile: ZM Weekly Chart Note that, since the IPO process, the stock appreciated by 671.09%, which is quite substantial. Many companies were negatively affected during the pandemic, but this one inadvertently benefited from the COVID-19 pandemic. In this first profile, we see the largest position buildup right at the range of 68.75 to 76.95. You can already see 2 candles of aggression, as shown in the second graph, causing significant drops. Analysis of the second profile: ZM Weekly Chart Observing the second profile, we see a lack of demand from buyers and a position buildup on the selling side, unlike what we observed at the beginning. Analysis of the third profile: ZM Daily Chart Upon examining the last profile, we see that despite the market coming from a downtrend channel, we can observe a drastic increase in volume per price level, which is a characteristic of a position buildup. As we gradually see, the seller has been reducing their position, and furthermore, the stock is in a downtrend channel that if it surpasses 78.50, combining it with the fundamentals, we could potentially have an upward trend. Macroeconomics and Technical Analysis Surprisingly, Zoom is not the only one that experienced a drop that significantly devalued its stock. Several companies listed on the Nasdaq Composite, including the Nasdaq Composite itself, suffered from a drop that impacted the United States economy. E-mini Nasdaq Weekly This was motivated by high inflation, which reached around 9%, which is indeed a very concerning figure for the US economy. By February, inflation had already reached 7.5%, which was already a very high percentage, as technology companies react poorly to inflation. This explains the poor performance of these stocks. February table Source: Tradingview Economic Calendar These data explain the drop in assets listed on the Nasdaq, but surprisingly, Zoom was affected much more than the other companies. Later, when the price started to increase slightly; And the year 2022 contributed even further to the devaluation of ZM shares. But as we can see, the asset was already in the process of falling long before: ZM Daily Chart There was the beginning of a bearish rally there. Even if the current data are not so favorable, the deflation process that occurred in the United States, together with the artificial intelligence race, could also be a detail that will greatly help in the ZM valuation process. September table updated Source: Tradingview Economic Calendar September's data clearly reveals a drop in inflation, but with several very significant drops, in addition to some negative points such as the reduction in job creation and economic development. Look at the table below: Source: Tradingview Economic Calendar Based on this table, Zoom Communications could have a positive result as the company recorded a drop in inflation in September, implying that the costs of products and services decreased. This can benefit consumers and businesses that use the Zoom Service. Conclusion Zoom Video Communications Inc. is a company with good financial and market performance, despite the broad devaluation it suffered in 2021/2022. It demonstrates good fundamental analysis with strong revenue and profit growth, a high net margin, low debt and a good market value. The company also presents good technical analysis. It is undervalued, having been at an all-time low since its IPO, building a position for a likely long-term upward trend. Although the macroeconomy does not favor the variable income market due to a high interest rate of 5.5% (possible readjustment to 5.75% in September), it can also benefit from the ongoing economic deflation, which should stabilize in the end of 2024. It also has the potential to recover from the decline it has experienced and stand out in the technology market, especially in the videoconferencing segment, which has been less and less in demand post-pandemic and in times of remote work. Demonstrating its ability to innovate and adapt to changes in the economic and social panorama, offering quality and safe solutions to its customers. Therefore, it is believed that Zoom is a good investment option for those seeking long-term profitability and growth. I hope you enjoyed this article and found it helpful. Thank you for your attention, and until next time!
NASDAQ:ZMLong
by Victoredbr
2
Docusign - In Theory, A Long-term Technical MultibaggerDocusign has its earnings call tomorrow and is another one of those stocks like Disney, Paypal, and Target that's been low for a long time (I have calls linked below), everyone wants to get long on, but they don't go up. The difference between the other three and Docusign is that Docusign may be undervalued at its $10 billion market cap and has significant tells in its price action that show it may be a multi-bagger long term. It shows the most clearly on the monthly, as the $180 level that the November of 2021 dump took out was never retested or even attempted to be retested on any time frame. This generally indicates that the market makers will take price back to this level. This is a notable development in light of the fact that price has been in a grinding chop and long accumulation for almost two years. However, the monthly and weekly candles show no signs that accumulation is complete. Namely, we are missing the "manipulation" stage of price action where lows are raided. Considering my thesis on the Nasdaq and the SPX being very bearish this month is legitimate: Nasdaq Futures - Are You Prepared For Red September? and SPX ES Futures - A Great Deal of Caution Is Advised On the basis that the JPM Collar where America and the world's most significant bank is long 15,800 SPX 4,225 puts that expire September 29 and have never been in the money is meaningful, Docusign earnings tomorrow morning may be a vanguard dumpster fire. The significant part of the Docusign price action is that the weekly bars show that even a pump to $60 or $61 is still bearish, and would follow in the footsteps of Disney and Target in being a market maker clowndunk on bulls. I think the trade on this is to long a higher lows pattern forming at either $42 or $38, since that would give the entire trading range since the IPO a higher lows pattern, or wait until a scheduled market rebound in 2025 after Joe Biden is given his second term as President because Donald Trump died in prison for Xeeeeeeting about election fraud. Either way, I think early bulls are going to get merked, but whoever can stay patient on this stock will pick up a multi-bagger. But that multi-bagger may not be scheduled for years, and years away from now may simply be too far away to matter whatsoever. The key problem with any long-term bull thesis on anything is the impending collapse of Xi Jinping's Chinese Communist Party, which has become ever more obvious from so many pieces of economic data, including reports that places like Shanghai are abnormally empty at the moment. The persecution of Falun Gong launched by Xi's predecessor Chairman Jiang Zemin on July 20, 1999, has gone on for 24 years and even included the unprecedented sin of live organ harvesting against 100 million spiritual cultivators. Although Xi has been executing the Jiang faction in droves since he came to power in 2013 under the Anti-Corruption Campaign for the persecution, and although Jiang died a few years ago, the persecution continues to this day. Because Xi is the head of the CCP, he's culpable and responsible for everything the Specter of Communism has done in all of human history. And so what we may see one day shortly is that Xi throws away the CCP during Beijing evening, which conveniently corresponds to right before Manhattan stock market opening. The gaps down will be relentless, and will never come back. The bump and run reversal plan to scam the entire world out of trillions more dollars by the Party West International Rules Based Order U.S. Empire will be all for nothing, and everyone will run for their lives. And on that basis, perhaps Docusign will never amount to anything, for those gaps are obviously there to be retraded to during the next pseudopandemic where you're supposed to stay in your house with the heat off, live on the Metaverse, work on Zoom, digital sign documents, and stay in your open air "15 Minute City" prisons. Because everyone has been going to Shanghai and Tsinghua to swear Marxist vows, sing Marxist songs, and train the CCP's Zero-COVID Social Credit System for export in exchange for benefits. Figuring it out isn't very hard. Believing in it isn't very hard. But too many people have made themselves fools. Humanity, I hope you can walk out of the catastrophe. But in reality, not many will.
NASDAQ:DOCU
by LordWrymouth
1
ZM Zoom Video Communications Options Ahead Of EarningsIf you haven`t entered ZM here: Or sold here: Then analyzing the options chain and the chart patterns of ZM Zoom Video Communications prior to the earnings report this week, I would consider purchasing the 66usd strike price Puts with an expiration date of 2023-8-25, for a premium of approximately $3.45. If these options prove to be profitable prior to the earnings release, I would sell at least half of them. Looking forward to read your opinion about it.
NASDAQ:ZMShort
by TopgOptions
2
Zoom Potential Rounding Bottoming Zoom Video was a darling stock during the pandemic when office workers were sheltering in place at home and communicating via video chats. Price hit a high near $600 in Q4 of 2020 and has fallen roughly -80% to current levels where it has levelled off and appears to be forming a bottom in the $70 range. Currently price is attempting to hold and trend above the 200ma which it hasn't done since the summer of 2021 when the previous attempt to regain the 200ma failed. Going forward we want to see price hold above the 200ma and take out short-term resistance at $75-$76.The short-term MA's are currently rising above the longer MA's which is an indication of a short-term bullish trend for price. We want to see price continue to move higher and for the short MA's to rise above the 200ma for a sign of bullish trend continuation. The PPO indicator show the green RSI line rising above the purple signal line which is a short-term bullish momentum indication. Both lines trending above the 0 level indicates intermediate to long-term bullish momentum behind price. The TDI indicator shows the RSI line crossing above 60 and in the upper half of the white Bollinger Bands which indicates a short-term bullish trend in price. The overall action of the green RSI line is trending between the 40-80 levels which indicates intermediate to long-term bullish price trend. Going forward we want to see the green RSI line continue to rise above the 60 level for short-term bullish bias in price which would help maintain above the 200ma. Price gapped down in Aug of 2022 so should Zoom hold current bullish bias and take out short-term resistance levels we could see a move to fill the gap up near $95-$96. My entry is at $73.95 with a stop loss at $68. No upper price target for now other than the gap target, will raise my stop-loss order as price moves higher and creates a series of higher highs and higher lows assuming that a breakout is coming.
NASDAQ:ZMLong
by PrepForProfit
ZM: Pre-Earnings Release RunZoom is showing a pre-earnings release run up out of its extreme low, ahead of its Q1 report today. The current run's pattern is indicative of professional traders swing trading with earnings strategies; they tend to take profits on the report since they bought at the low. While revenues are likely to come in below last quarter, earnings should improve over the big loss last quarter. The stock has probably found its final low, at long-term support from 2020. ZM outperformed during the pandemic due to huge demand that was unsustainable and time limited. So it has a lot of work to do from here; it must reinvent to offer a greatly improved service to compete with huge companies like Google, etc. which all have very similar services.
NASDAQ:ZM
by MarthaStokesCMT-TechniTrader
The Zoom Chart Has To Be SeenFew charts can explain the euphoria and panic of markets more than this chart of Zoom. We've also used Zoom at least once by now to make a voice and video call. It was the darling after the Covid lockdowns because it was leading the way for remote work. The before and after can be easily seen just by looking at the chart. It was up 900% in a brief period of time! Then... it dropped 90%. The euphoria of remote work, fast growth, and easy money. Followed by the return to normalcy and a crash of its price. The question now is as follows: at what point is Zoom a value play? It remains the leader of video conferencing and still has a large, global customer base. They surely need to innovate and create more solutions. Time will tell. I have no position. Just watching the chart. I do think a swing trade could set up as it drops even more. A quick rebound appears possible. Zoom would be foolish not to cut costs and attempt to buy some shares back down here.
NASDAQ:ZM
by scheplick
4
Investing in Zoom stock: Will You be Profiting Long-Term?Are you on the lookout for a solid investment opportunity in the current market? Look no further than Zoom Video Communications! Although media reports or rumours about a significant change in a company’s business prospects usually cause its stock to trend and lead to an immediate price change, certain fundamental factors always drive the buy-and-hold decision. Zoom Video Communications stock company is reacting to a very strong monthly demand level located around $70 per share. There is a lot of profit for margin for this long-term buy opportunity of Zoom Video Communications shares. There is room for this tech stock to reach $250; it will need a few months, bu
NASDAQ:ZMLong
by AlfonsoMoreno
1
Zoom rallies to be capped.Zoom - 30d expiry - We look to Sell at 77.77 (stop at 82.43) We are trading at oversold extremes. There is no clear indication that the downward move is coming to an end. The primary trend remains bearish. The stock is currently underperforming in its sector. 20 1 week EMA is at 78. We look for a temporary move higher. Preferred trade is to sell into rallies. Our profit targets will be 66.10 and 64.10 Resistance: 72.17 / 78.00 / 81.50 Support: 68.00 / 66.00 / 63.55 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
NASDAQ:ZMShort
by VantageMarkets
Zoom approaching all time lows.Zoom - 30d expiry - We look to Sell a break of 68.68 (stop at 71.71) Trades at the lowest level in 34months. Price action continues to trade around the all-time lows. We are trading at oversold extremes. This stock fell 3 % last week. Short term momentum is bearish. A break of the recent low at 68.88 should result in a further move lower. The bias is to break to the downside. Our profit targets will be 61.11 and 60.11 Resistance: 73.00 / 77.30 / 80.00 Support: 68.88 / 65.00 / 62.00 Disclaimer – Saxo Bank Group. Please be reminded – you alone are responsible for your trading – both gains and losses. There is a very high degree of risk involved in trading. The technical analysis , like any and all indicators, strategies, columns, articles and other features accessible on/though this site (including those from Signal Centre) are for informational purposes only and should not be construed as investment advice by you. Such technical analysis are believed to be obtained from sources believed to be reliable, but not warrant their respective completeness or accuracy, or warrant any results from the use of the information. Your use of the technical analysis , as would also your use of any and all mentioned indicators, strategies, columns, articles and all other features, is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness (including suitability) of the information. You should assess the risk of any trade with your financial adviser and make your own independent decision(s) regarding any tradable products which may be the subject matter of the technical analysis or any of the said indicators, strategies, columns, articles and all other features. Please also be reminded that if despite the above, any of the said technical analysis (or any of the said indicators, strategies, columns, articles and other features accessible on/through this site) is found to be advisory or a recommendation; and not merely informational in nature, the same is in any event provided with the intention of being for general circulation and availability only. As such it is not intended to and does not form part of any offer or recommendation directed at you specifically, or have any regard to the investment objectives, financial situation or needs of yourself or any other specific person. Before committing to a trade or investment therefore, please seek advice from a financial or other professional adviser regarding the suitability of the product for you and (where available) read the relevant product offer/description documents, including the risk disclosures. If you do not wish to seek such financial advice, please still exercise your mind and consider carefully whether the product is suitable for you because you alone remain responsible for your trading – both gains and losses.
NASDAQ:ZMShort
by Saxo