Buy or Sell Zoom Stock Around $100?

January 27th, 2026 by Trefis Team
ZM: Zoom Communications logo
ZM
Zoom Communications

Zoom Communications stock (NASDAQ: ZM) hit a fresh 52-week high of $96 on January 26, 2026, with momentum continuing in extended trading. The catalyst? Analysts now value Zoom’s $51 million stake in AI company Anthropic at $2-4 billion—a potential 40-80x return that’s catching investors’ attention.

But does the Anthropic windfall change the fundamental picture? Not really. While the investment looks impressive on paper, Zoom’s core business tells a more sobering story. Revenue growth has stalled at just 3.4% annually over three years—well below the S&P 500’s 5.6%. The pandemic darling that once seemed unstoppable is now struggling to expand its top line.

That being said, if you seek an upside with less volatility than holding an individual stock like ZM, consider the High Quality Portfolio. It has comfortably outperformed its benchmark—a combination of the S&P 500, Russell, and S&P MidCap indexes—and has achieved returns exceeding 105% since its inception. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.

What about profitability? Aren’t the margins strong?

Absolutely. This is where Zoom shines. Operating margins of 22.9% and net margins of 33.2% are exceptional—both significantly outpacing the broader market. The company generates $2.1 billion in operating cash flow on $4.8 billion in revenue. It’s a cash machine.

So it’s financially sound?

Very. Zoom carries just $48 million in debt against a $29 billion market cap—essentially a rounding error. With $7.9 billion in cash representing 70% of total assets, the balance sheet is fortress-strong. There’s no financial distress here.

Then what’s the problem?

Two things. First, growth has flatlined. When your revenue barely budges while the market grows twice as fast, you’re losing ground. Second, Zoom has proven fragile during market turbulence. The stock plunged 87% during the 2022 inflation shock and dropped 41% during the 2020 pandemic—yes, even during the period when everyone was using Zoom constantly.

What does the valuation say?

At a P/E of 18.1 versus 24.5 for the S&P 500, Zoom looks modestly cheap. But here’s the rub: lower multiples often signal lower growth expectations. The market is pricing in exactly what Zoom is delivering—decent profitability with minimal expansion.

Bottom line?

Zoom is fairly priced, which makes it neither compelling nor unattractive. The Anthropic investment adds speculative upside, but it doesn’t fix the core challenge: Zoom needs to reignite growth. Great margins and a clean balance sheet can’t compensate forever for a business stuck in neutral.

If you’re bullish on the Anthropic bet materializing and believe Zoom can reaccelerate revenue, there’s a case to buy. If you want steady growth and resilience, look elsewhere.

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