Will Zoom Video Stock 'Zoom' Higher After Reporting Q3 Earnings?

The remote working trend continues to benefit Zoom Video Communications (ZM Quick QuoteZM - Free Report) , which has staged a remarkable turnaround this year amid robust demand for its video platform. Zoom, a Zacks Rank #2 (Buy), has established a stellar track record in terms of surpassing earnings estimates. With ZM shares breaking out ahead of the upcoming announcement, is now the time to buy?

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Zoom is set to report third-quarter results on Monday after the bell. The Zacks Consensus Estimate calls for earnings of $1.31 per share, reflecting a 1.6% improvement relative to the same quarter last year. Sales are anticipated to have risen 2.34% to $1.16 billion during the third quarter.

The communications platform hasn’t missed the earnings mark in several years. Zoom has delivered an average earnings surprise of 17.8% over the past four quarters.

Zoom’s expanding international footprint is a major growth driver. The company maintains a strong balance sheet and generates significant cash flow.

ZM stock trades relatively undervalued at just 14.7 times forward earnings. Our proprietary Zacks ESP indicator is not conclusively predicting another earnings beat. Keep in mind that stocks can be volatile in the aftermath of earnings announcements.