ZOOM COMMUNICATIONS INC (5ZM.DE) Stock Fundamental Analysis

Europe • Frankfurt Stock Exchange • FRA:5ZM • US98980L1017

80.34 EUR

-0.61 (-0.75%)

Last: Jan 29, 2026, 07:00 PM

Fundamental Rating

Overall 5ZM gets a fundamental rating of 7 out of 10. We evaluated 5ZM against 114 industry peers in the Software industry. Both the health and profitability get an excellent rating, making 5ZM a very profitable company, without any liquidiy or solvency issues. 5ZM has a correct valuation and a medium growth rate. This makes 5ZM very considerable for quality investing!

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1. Profitability

1.1 Basic Checks

In the past year 5ZM was profitable.
5ZM had a positive operating cash flow in the past year.
5ZM had positive earnings in each of the past 5 years.
5ZM had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

5ZM has a better Return On Assets (13.99%) than 85.09% of its industry peers.
5ZM's Return On Equity of 17.16% is fine compared to the rest of the industry. 5ZM outperforms 71.05% of its industry peers.
With a decent Return On Invested Capital value of 9.08%, 5ZM is doing good in the industry, outperforming 65.79% of the companies in the same industry.
5ZM had an Average Return On Invested Capital over the past 3 years of 5.31%. This is significantly below the industry average of 13.49%.
The 3 year average ROIC (5.31%) for 5ZM is below the current ROIC(9.08%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	13.99%
ROE	17.16%
ROIC	9.08%

ROA(3y)5.63%

ROA(5y)9.55%

ROE(3y)6.98%

ROE(5y)12.42%

ROIC(3y)5.31%

ROIC(5y)8.46%

1.3 Margins

5ZM's Profit Margin of 33.17% is amongst the best of the industry. 5ZM outperforms 92.11% of its industry peers.
In the last couple of years the Profit Margin of 5ZM has grown nicely.
Looking at the Operating Margin, with a value of 23.24%, 5ZM is in the better half of the industry, outperforming 79.82% of the companies in the same industry.
5ZM's Operating Margin has improved in the last couple of years.
5ZM has a Gross Margin (76.89%) which is in line with its industry peers.
5ZM's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	23.24%
PM (TTM)	33.17%
GM	76.89%

OM growth 3Y-12.41%

OM growth 5Y53.6%

PM growth 3Y-13.57%

PM growth 5Y44.03%

GM growth 3Y0.67%

GM growth 5Y-1.43%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), 5ZM is destroying value.
Compared to 1 year ago, 5ZM has less shares outstanding
The number of shares outstanding for 5ZM has been increased compared to 5 years ago.
5ZM has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

An Altman-Z score of 10.19 indicates that 5ZM is not in any danger for bankruptcy at the moment.
The Altman-Z score of 5ZM (10.19) is better than 88.60% of its industry peers.
There is no outstanding debt for 5ZM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

		Industry Rank	Sector Rank
Debt/Equity	0
Debt/FCF	0
Altman-Z	10.19

ROIC/WACC0.82

WACC11.12%

2.3 Liquidity

A Current Ratio of 4.45 indicates that 5ZM has no problem at all paying its short term obligations.
5ZM has a better Current ratio (4.45) than 89.47% of its industry peers.
5ZM has a Quick Ratio of 4.45. This indicates that 5ZM is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 4.45, 5ZM belongs to the top of the industry, outperforming 89.47% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	4.45
Quick Ratio	4.45

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

5ZM shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.32%.
Measured over the past years, 5ZM shows a very strong growth in Earnings Per Share. The EPS has been growing by 73.67% on average per year.
The Revenue has been growing slightly by 3.85% in the past year.
Measured over the past years, 5ZM shows a very strong growth in Revenue. The Revenue has been growing by 49.60% on average per year.

EPS 1Y (TTM)6.32%

EPS 3Y2.87%

EPS 5Y73.67%

EPS Q2Q%10.14%

Revenue 1Y (TTM)3.85%

Revenue growth 3Y4.4%

Revenue growth 5Y49.6%

Sales Q2Q%4.44%

3.2 Future

The Earnings Per Share is expected to grow by 4.04% on average over the next years.
The Revenue is expected to grow by 3.88% on average over the next years.

EPS Next Y12.78%

EPS Next 2Y6.29%

EPS Next 3Y5.37%

EPS Next 5Y4.04%

Revenue Next Year4.21%

Revenue Next 2Y3.87%

Revenue Next 3Y3.81%

Revenue Next 5Y3.88%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 16.33, the valuation of 5ZM can be described as correct.
Compared to the rest of the industry, the Price/Earnings ratio of 5ZM indicates a rather cheap valuation: 5ZM is cheaper than 85.09% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 28.39. 5ZM is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 15.39, 5ZM is valued correctly.
Based on the Price/Forward Earnings ratio, 5ZM is valued cheaper than 84.21% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of 5ZM to the average of the S&P500 Index (25.72), we can say 5ZM is valued slightly cheaper.

		Industry Rank	Sector Rank
PE	16.33
Fwd PE	15.39

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 5ZM indicates a somewhat cheap valuation: 5ZM is cheaper than 78.07% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of 5ZM indicates a rather cheap valuation: 5ZM is cheaper than 85.09% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	14.23
EV/EBITDA	11.03

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
5ZM has a very decent profitability rating, which may justify a higher PE ratio.