ZM
Zoom Communications, Inc.
$95.31
Platform & Compounding FCF
80%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 1.5% below fair value
You pay
$95.31
Bear
$86.66
Fair
$96.72
Bull
$105.45
Bear
$86.66
-9.1%
3% stage 1 growth, 11% discount
Fair
$96.72
+1.5%
5% stage 1 growth, 11% discount
Bull
$105.45
+10.6%
7% stage 1 growth, 11% discount
Adjust Assumptions
5.3%
11.0%
3.0%
Key Value Driver
FCF growth rate (5% base case)
Terminal Value % of EV
35%
Implied Market Multiple
14.9x
Market is pricing in (growth)
5.0%
vs 5.3% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (49 analysts)
$118.08
Divergence from AlphaVal
18%
Summary
Using a two-stage FCF DCF with 5% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $96.72 per share.
Warnings
Stock-based employee pay equals 40% of profits. This dilutes existing shareholders, so cash flow alone overstates what owners really earn.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions