Value In ZM


Zoom (ZM) just reported 4Q22 earnings – including full year 2023 guidance – and I think there is value in shares here. ZM is guiding 2023 revenue to $4.435-$4.455 billion and Non-GAAP EPS to $4.11-$4.18. They also have $5.4 billion in cash and marketable securities on their balance sheet which works out to $18/share. In other words, ZM has about 25% of its market cap in cash and short term securities. So you’re really only paying $56 for the business. And that business is highly profitable. While I’m concerned about competition in the space there is also the possibility of an acquisition by a larger player. ZM shares are currently +6% in the after hours.

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