Stock fact sheet · data as of
Zoom Communications, Inc. (ZM): fair value, margin of safety and Wheel Score
Technology · Software - Application · United States · Value
Is ZM undervalued?
ZM has a margin of safety of 53%: the stock closed at 94.47 on 16 Oct 2026 against a GLS average fair value of 199.41. 6 of the 8 valuation models that produced a number sit above the price. Our screens treat a discount this large as a strong starting point for a cash-secured put, not as a verdict - the fair value is a model output, and a wide gap can mean the models are missing something the market knows.
There is a wide gap between Lynch (20.62) and GLS Growth (678.53). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.
The nightly engine files ZM under Value: positive earnings at a P/E of 18 or less.
Nine valuation models for ZM
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 86.92 | -8% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 97.97 | +4% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 132.44 | +40% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 20.62 | -78% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 678.53 | +618% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 195.98 | +107% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 259.64 | +175% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | - | - | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend; no value tonight |
| EPV | 123.15 | +30% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | 22.19 | -77% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 118.08 | +25% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Zoom Communications, Inc. scores only 4 of 9 on the Piotroski F-score, which fails the Sunday Scan's "6 or more" rule. A reading this low means several of the basic tests - positive earnings, positive operating cash flow, falling debt, no new share issuance - are not met. A GLS Moat score of 7.9/10 puts ZM among the more durable businesses we track: over ten years the metrics the score watches (revenue, EPS, book value, margins, cash flow, ROIC) have mostly moved the right way, year after year.
Returns on capital are high - ROIC 19.3%, ROE 19.4%, ROA 15.9% - with debt at 0.01 times equity and a free-cash-flow yield of 7.0%.
Zoom Communications, Inc. pays no dividend, so the DDM model does not apply and a covered-call holder earns only the premium and any price gain. Revenue comes mainly from Reportable 100% (quarter Q2 FY2027).
Institutional ownership scores 9/10, insider activity 2/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 4 / 9 | ROIC | 19.3% |
|---|---|---|---|
| GLS Moat | 7.9 / 10 | ROE | 19.4% |
| Debt / equity | 0.01 | ROA | 15.9% |
| Free-cash-flow yield | 7.0% | Payout ratio | 0% |
| Institutions | 9 / 10 | Insiders · Congress | 2 · 5 / 10 |
Wheel Score 86: Prime
With a Wheel Score of 86, Zoom Communications, Inc. sits in the Prime band - price, quality and premium all line up for the wheel strategy. The parts: Value 25/25, Health 9/20, Moat 12/15, Premium 20/20, Stability 20/20. A high score is a ranking, not a signal: it says nothing about timing, the earnings date or your position size.
Implied volatility is 45% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. The option chain is deep: 241,059 contracts of open interest across all expiries, which means tight fills at most strikes.
Volume runs at 3.5M shares a day on a market cap of $27.7B, with a beta of 1.03; the Stability part of the Wheel Score gives that 20 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 25 / 25 | 53% margin of safety | |
| Health | 9 / 20 | Piotroski 4/9 | |
| Moat | 12 / 15 | moat 7.9/10 | |
| Premium | 20 / 20 | implied volatility 45% | |
| Stability | 20 / 20 | 3.5M shares/day, $27.7B cap, beta 1.03 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 23 Nov 2026 (after the close), 38 days away; a 30-45-day put sold today would expire after it, which is worth weighing against the premium.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Software - Application
The 12 companies below are the closest to Zoom Communications, Inc. by market cap within the Software - Application industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| STRF MicroStrategy Incorporated 10.00% Series A Perpetual Strife Preferred Stock | 103.34 | - | - | 35Weak | $30.7B |
| STRD Strategy Inc | 71.64 | - | - | 42Weak | $23.7B |
| STRC Strategy Inc | 99.74 | - | - | 38Weak | $33.0B |
| STRK Strategy Inc | 73.62 | - | - | 27No options | $21.9B |
| BSP Bending Spoons S.p.A. | 55.77 | 17.35 | -221% | 32Weak | $35.4B |
| PTC PTC Inc. | 193.64 | 185.02 | -5% | 61Fair | $21.0B |
| ROP Roper Technologies, Inc. | 372.69 | 587.95 | +37% | 92Prime | $36.9B |
| SSNC SS&C Technologies Holdings, Inc. | 82.05 | 81.05 | -1% | 79Good | $19.3B |
| DT Dynatrace, Inc. | 63.73 | 23.38 | -173% | 62Fair | $18.5B |
| U Unity Software Inc. | 41.40 | 24.64 | -68% | 45Weak | $18.2B |
| NBIS Nebius Group N.V. | 188.41 | 9.50 | -1883% | 50Fair | $45.2B |
| FICO Fair Isaac Corporation | 769.93 | 844.92 | +9% | 81Prime | $16.6B |
Screen the whole market the same way
A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the same eight-rule screen, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about ZM
Is ZM undervalued right now?
By the GLS models, yes: at 94.47 the stock is 53% below the average fair value of 199.41 (data as of 16 Oct 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of ZM and what does it mean?
ZM scores 86 out of 100 (Prime). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for ZM?
199.41 per share as of 16 Oct 2026 - the simple average of the 8 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Zoom Communications, Inc. report earnings next?
The next earnings report is due on 23 Nov 2026 (after the close), 38 days from the data date of 16 Oct 2026. The Calendars page lists every upcoming report with its time of day.
Does ZM have listed options, and how liquid are they?
Yes. The nightly snapshot found 1,000 listed contracts with 241,059 open interest across all expiries and implied volatility of 45% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.