Zoom Stock Just Scored a New 'Buy' Rating. Here's Why.

Wajeeh Khan

Wed, August 19, 2026 at 10:00 PM GMT+3 2 min read

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Zoom Communications (ZM) shares have been ripping higher since late July, but a senior Bank of America analyst believes the rally is not out of steam just yet. Analyst Matt Bullock reinstated coverage on the videoconferencing platform on Aug. 19 with a "Buy" rating and a $130 price target, indicating potential upside of more than 20% from here.

Versus its July low, Zoom stock is up nearly 30% at the time of writing.

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Why BofA Recommends Buying Zoom Stock

Bullock's bullish thesis hinges on Zoom's successful transition from a pandemic-era single product video tool into a comprehensive, enterprise-grade communications platform.

After years of valuation resets due to contract overprovisioning and competitive headwinds from rivals such as Microsoft (MSFT) Teams, the firm's core fundamentals are now noticeably improving.

"Growth is reaccelerating, enterprise spend is healthier, the consumer segment has stabilized, and FCF margins remain robust at 35%+," he told clients in a research note on Wednesday.

Note that Barchart also currently holds an "88% BUY" average opinion on ZM shares, indicating technical momentum also currently favors continued upside ahead.

What Else Makes ZM Shares Attractive?

The BofA analyst believes Zoom can sustain revenue growth in the mid-single-digit percentage range on the back of "new product cycles" and expanding platform capabilities.

Beyond videoconferencing, the Nasdaq-listed firm is winning over Wall Street by monetizing its broader ecosystem, particularly through its AI Companion and expanded Contact Center offerings.

It's embedding generative artificial intelligence capabilities into its standard licensing tiers at no additional fee, which is helping deepen user engagement and upsell higher-value product tiers to enterprise clients.

This broader product suite is boosting customer retention rates and driving higher average revenue per user (ARPU), Bullock concluded in his report.

What's the Consensus Rating on Zoom?

Other Wall Street firms also agree with BofA's bullish view, believing the firm's lean cost structure, disciplined capital allocation, and a sizable stake in Anthropic make it a compelling long-term buy.

The consensus rating on Zoom shares sits at "Moderate Buy," with price objectives as high as $135 indicating potential upside of more than 25% from here.