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Website Traffic Predicting Zoom Video’s Q3 Earnings
Stock Analysis & Ideas

Website Traffic Predicting Zoom Video’s Q3 Earnings

Zoom Video Communications (ZM), the video conferencing company, will report its third-quarter fiscal 2022 earnings on November 22.

Zoom’s sales and profitability have benefited significantly from the COVID-related closures. In fiscal Q2, the company performed magnificently, with revenue surpassing $1 billion for the first time, in addition to strong profitability and cash flow.

As the global provider of online video communication tools, Zoom thrives on volume to its websites; hence insights could be extracted from its online traffic statistics. TipRanks’ Website Traffic tool, which analyzes website traffic volume data provided by Semrush (SEMR), helps predict the company’s Q3 earnings.

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Improved Website Traffic Numbers

Zoom’s website traffic patterns looked to be improving in fiscal 3Q22, according to online volume data. We saw that the number of unique visitors to Zoom’s website increased by 1.02% from July to September, following a decline in Q2. During the same time span, however, the stock price dropped 27.4%.

When we look at the overall number of unique visitors to Zoom’s website on a year-to-date basis, we see a 30.81% rise.

This indicates that, despite a drop in internet traffic in Q2, Zoom is regaining some traction and attracting more visits to its website.

On a less positive note, the tailwinds that benefited Zoom during the lockdowns last year have started to wane, as seen by the share price decrease. However, Zoom investors should not be concerned because the work-from-home trend is anticipated to continue indefinitely.

User Data by Geography

Looking at website traffic statistics by area gives us a better understanding of web traffic patterns and user behavior.

In October, the United States took the greatest share of the pie, accounting for 36.1%. Meanwhile, users in India accounted for 6.8% of all unique virtual visitors, putting the nation in second place, ahead of Korea, Republic (7.5%), and Indonesia (4.1%).

Wall Street’s Stance

Ahead of the fiscal Q3 earnings announcement, Morgan Stanley analyst Meta Marshall maintained a Buy rating on the stock but decreased the price target to $365.00 from $400.00. Zoom’s new price target suggests 38.4% upside potential.

Wall Street analyst consensus has a fairly optimistic stance towards Zoom, with a Moderate Buy rating based on 12 Buys and 9 Holds assigned in the past three months. At $343.69, the average Zoom Video price target implies 30.3% upside potential.

Disclosure: At the time of publication, Shalu Saraf did not have a position in any of the securities mentioned in this article.

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