Head to Head Analysis: Zoom Communications (NASDAQ:ZM) and Arqit Quantum (NASDAQ:ARQQ)

Zoom Communications (NASDAQ:ZM) and Arqit Quantum (NASDAQ:ARQQ) are both computer and technology companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, institutional ownership, analyst recommendations, risk, valuation, dividends and profitability.

Earnings & Valuation

This table compares Zoom Communications and Arqit Quantum”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zoom Communications	$4.87 billion	5.19	$1.90 billion	$6.81	12.65
Arqit Quantum	$530,000.00	787.87	-$35.34 million	N/A	N/A

Zoom Communications has higher revenue and earnings than Arqit Quantum.

Profitability

This table compares Zoom Communications and Arqit Quantum’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zoom Communications	41.99%	11.87%	9.69%
Arqit Quantum	N/A	N/A	N/A

Insider & Institutional Ownership

66.5% of Zoom Communications shares are owned by institutional investors. Comparatively, 16.6% of Arqit Quantum shares are owned by institutional investors. 8.8% of Zoom Communications shares are owned by company insiders. Comparatively, 54.6% of Arqit Quantum shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Volatility and Risk

Zoom Communications has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500. Comparatively, Arqit Quantum has a beta of 2.36, meaning that its share price is 136% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for Zoom Communications and Arqit Quantum, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zoom Communications	0	12	15	0	2.56
Arqit Quantum	1	0	1	0	2.00

Zoom Communications presently has a consensus price target of $109.33, suggesting a potential upside of 26.93%. Arqit Quantum has a consensus price target of $60.00, suggesting a potential upside of 119.70%. Given Arqit Quantum’s higher possible upside, analysts clearly believe Arqit Quantum is more favorable than Zoom Communications.

Summary

Zoom Communications beats Arqit Quantum on 8 of the 12 factors compared between the two stocks.

About Zoom Communications

Zoom Video Communications, Inc. provides unified communications platform in the Americas, the Asia Pacific, Europe, the Middle East, and Africa. The company offers Zoom Meetings that offers HD video, voice, chat, and content sharing through mobile devices, desktops, laptops, telephones, and conference room systems; Zoom Phone, an enterprise cloud phone system; and Zoom Chat enables users to share messages, images, audio files, and content in desktop, laptop, tablet, and mobile devices. It also provides Zoom Rooms, a software-based conference room system; Zoom Conference Room Connector, a gateway for SIP/H.323 endpoints to join Zoom meetings; Zoom Events, which enables users to manage and host internal and external virtual events; OnZoom, a prosumer-focused virtual event platform and marketplace for Zoom users to create, host, and monetize online events; and Zoom Webinars to provide video presentations to large audiences from many devices. In addition, the company offers Zoom Developer Platform that enables developers, platform integrators, service providers, and customers to build apps and integrations using Zoom’s video-based communications solutions, as well as integrate Zoom’s technology into their products and services; Zoom App Marketplace, which helps developers to publish their apps, as well as third-party integrations of Zoom; and Zoom Contact Center, an omnichannel contact center solution. It serves individuals; and education, entertainment/media, enterprise infrastructure, finance, government, healthcare, manufacturing, non-profit/not for profit and social impact, retail/consumer products, and software/Internet industries. The company was formerly known as Zoom Communications, Inc. and changed its name to Zoom Video Communications, Inc. in May 2012. The company was incorporated in 2011 and is headquartered in San Jose, California.

About Arqit Quantum

Arqit Quantum Inc. provides cybersecurity services through satellite and terrestrial platforms in the United Kingdom. It offers QuantumCloud, a Platform as a Service that creates unbreakable software encryption keys. The company also provides maintenance and support, and professional services. Arqit Quantum Inc. is based in London, the United Kingdom.