2024-01-25 17:56:57 ET
Summary
- Zoom's stock is only flat in the past twelve months, missing out on much stronger gains in the rest of the software sector.
- The company has launched new products and features, driving greater adoption in the enterprise segment.
- Despite slower growth rates, Zoom's growth drivers, cost-cutting measures, and cash hoard make it a rare bargain in an expensive market.
There's no doubt about it now: after the latest market rally that began in November and continued through early 2024, the broad market indices are quite expensive again - especially considering interest rates, though expected to drop this year, are still high. Now that the S&P 500 trades at a ~19x forward P/E multiple (several turns above historical averages), we should lean more toward value-based plays that have less downside in the event of a correction....
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For further details see:
Zoom: At 14x P/E, I'm Incredibly Long (Rating Upgrade)