On September 12, 2023, Velchamy Sankarlingam, the President of Engineering & Product at Zoom Video Communications Inc (ZM, Financial), sold 1,586 shares of the company. This move is part of a broader trend of insider selling at Zoom Video Communications Inc, which we will explore in this article.
Who is Velchamy Sankarlingam?
Velchamy Sankarlingam is the President of Engineering & Product at Zoom Video Communications Inc. He is responsible for the company's product, platform, and infrastructure teams. Sankarlingam has a wealth of experience in the tech industry, having previously held leadership roles at companies like VMware and Cisco. His role at Zoom involves overseeing the development and execution of the company's product strategy and roadmap.
About Zoom Video Communications Inc
Zoom Video Communications Inc is a leading provider of video-first unified communications, offering a comprehensive set of cloud-native, scalable, secure, and user-friendly video conferencing and collaboration features. The company's platform connects people through frictionless video, voice, chat, and content sharing, enabling face-to-face video experiences for thousands of people in a single meeting across disparate devices and locations.
Insider Sell Analysis
Over the past year, the insider has sold a total of 6,953 shares and purchased 0 shares. This recent sale of 1,586 shares is part of a broader trend of insider selling at Zoom Video Communications Inc. In fact, over the past year, there have been 45 insider sells and 0 insider buys. This could indicate that insiders believe the stock is currently overvalued, prompting them to sell their shares.
However, it's important to note that insider selling doesn't necessarily mean that the stock's price will decline. Insiders may sell their shares for various reasons, including personal financial planning or diversification. Therefore, while insider selling can provide useful insights, it should not be the sole basis for investment decisions.
Zoom Video Communications Inc's Valuation
On the day of the insider's recent sale, shares of Zoom Video Communications Inc were trading at $70.69, giving the company a market cap of $21.68 billion. The stock's price-earnings ratio is 163.75, which is higher than the industry median of 27.31 but lower than the company's historical median price-earnings ratio.
According to the GuruFocus Value, which is an intrinsic value estimate based on historical multiples, a GuruFocus adjustment factor, and future business performance estimates, Zoom Video Communications Inc is significantly undervalued. With a price of $70.69 and a GuruFocus Value of $127.91, the stock has a price-to-GF-Value ratio of 0.55.
In conclusion, while there has been a trend of insider selling at Zoom Video Communications Inc, the stock appears to be significantly undervalued according to the GuruFocus Value. As always, investors should conduct their own research and consider multiple factors before making investment decisions.