Can the Zoom Dip Get Even Worse?
Zoom is never reclaiming the highs it set during the pandemic.
Can the Zoom Dip Get Even Worse?
Overview
Zoom Communications (NASDAQ: ZM) dropped by more than 20% over the past month. The pandemic bubble popped for the video conferencing company in 2021, and it looks like the stock will never reclaim those levels. The current drop doesn't seem to be over. Here's why investors shouldn't buy Zoom on the dip.
A 12.7 P/E ratio looks attractive on the surface. Zoom commanded a P/E ratio in the 20s for most of 2025, but growth rates have also shrunk over the years. Zoom's revenue has a five-year compound annual growth rate (CAGR) of 12.9%, but only a 3.5% CAGR over the past three years.
Details
Revenue growth rates have steadily dropped since the pandemic, when Zoom was necessary for day-to-day communication. Zoom isn't going to get the catalyst of global lockdowns again, so it's easy to interpret its pandemic success as a one-off event.
Source
Originally published at www.fool.com.
