Nucor earnings beat by $0.08, revenue fell short of estimates
On Wednesday, Citi analyst Tyler Radke adjusted the price target for Zoom Video Communications , Inc. (NASDAQ:ZM), reducing it to $84 from the previous $85 while maintaining a Neutral rating on the company’s shares. Radke cited that Zoom’s margins appear to have reached their peak and the company faces limited growth catalysts moving forward.
Radke pointed out that although there has been a slight improvement in web traffic data for Zoom, it is still trailing behind its competitor, Teams, which has shown positive growth. Despite the competitive landscape, Radke noted that Zoom’s lower exposure to large deals, minimal reliance on government contracts, and the small portion of IT budgets typically allocated to meeting software could help buffer the company against potential tariff and macroeconomic impacts. For deeper insights into the competitive dynamics of tech companies like Zoom, InvestingPro offers comprehensive analysis and real-time metrics in its Pro Research Reports.
The decision to keep the estimates unchanged was influenced by the absence of significant near-term revenue or margin impacts, as evidenced by the relatively stable performance of Five9, Inc. (NASDAQ:FIVN) and Bandwidth Inc. (NASDAQ:BAND) in the first quarter of 2025. According to InvestingPro data, BAND has shown strong resilience with 18.5% revenue growth over the last twelve months and maintains healthy liquidity with a current ratio of 1.31. These companies’ results are considered indicative of the current macro environment for the communications technology sector.
The slight decrease in Zoom’s price target is attributed to an updated regression analysis and the valuation roll-forward, as explained by Radke in his commentary. Despite the reduced price target, the Neutral rating suggests that Citi’s outlook on Zoom’s stock remains steady without a strong bias towards either buying or selling. InvestingPro analysis indicates that BAND is currently undervalued, with analysts expecting profitability this year. Additional insights and 8 more ProTips are available on the platform.
In other recent news, Bandwidth Inc. reported strong first-quarter 2025 financial results, surpassing market expectations. The company achieved a non-GAAP earnings per share (EPS) of $0.36, exceeding the consensus estimate of $0.27. Revenue reached $174 million, up from the expected $169 million, marking a 7% year-over-year increase. The Cloud Communications segment contributed $133 million, above the consensus of $131 million. Despite these positive results, Bandwidth recorded a free cash flow of negative $13 million, which was below the anticipated negative $1 million.
In terms of analyst actions, JMP Securities maintained a Market Outperform rating for Bandwidth with a price target of $36.00, reflecting confidence in the company’s performance. Needham initiated coverage with a Buy rating and a $20.00 price target, citing Bandwidth’s growing free cash flow and EBITDA margins. The firm highlighted the potential for sustained growth in the Enterprise Voice segment, driven by favorable market trends and the company’s competitive edge through offerings like the Maestro operating system.
Bandwidth also raised its full-year revenue and EBITDA guidance, anticipating continued expansion in its AI and messaging services. The company’s strategy of integrating AI and expanding global network capabilities appears to be yielding positive results, positioning Bandwidth for further growth in the competitive CPaaS market.
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