By Sam Boughedda
Investing.com -- Shares of Zoom Video Communications Inc (NASDAQ:ZM) are now trading up 0.5% after opening the session more than $5 below Wednesday's close following comments from Morgan Stanley analyst Meta Marshall.
Marshall reiterated an Overweight rating on Zoom shares and a $165 price target ahead of its fourth quarter earnings on Monday.
The analyst stated they remain Overweight Zoom shares because they believe the market is "fundamentally undervaluing ZM's growth potential as they leverage their installed base, instead dismissing it as a WFH winner."
Zoom benefitted significantly from the pandemic as workers were told to work from home and utilize software such as Zoom for meetings. However, after hitting a high of over $588 in October 2020, its shares have plummeted. They are now down 66% in the last 12 months.
The analyst added that they think Zoom remains one of the more profitable software companies out there. "We believe FQ4 offers a catalyst (or eventual catalyst given software sentiment) to revive interest in ZM with FY23 guidance."