Zoom Video Communications Inc (NASDAQ:ZM) is 3.6% lower to trade at $109.19 on Tuesday, after Citigroup cut its rating on the shares to "sell" and slashed its price target to $91. The firm continues to emphasize the company's post-Covid growth hurdles, but now notes growing competition from Microsoft Teams as well as macro-related weaknesses.
Put activity is ramping up after the bear note, with 30,000 puts already exchanged, which is double the average intraday amount and outpacing the 23,000 calls across the tape so far today. The August 105-strike put and 112-strike call are the two most popular contracts, with new positions being opened at each.
This options pits have already been more bearish than usual of late. ZM sports a 50-day put/call volume ratio of 0.80 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 84% of readings from the past year.
Circling back to analysts, there's room for additional brokerages to follow Citigroup's lead. Specifically, eight of the 21 in coverage still rate Zoom stock a "buy" or better. Meanwhile, the 12-month consensus price target of $152.02 is a 40.6% premium to ZM's current level of trading, leaving the equity vulnerable to price-target cuts.
On the charts, the equity has mostly consolidated below the $120 level since April, with a brief rise above the ceiling stopped by long-term pressure from the 140-day moving average. Year-to-date, Zoom stock is down more than 41%.
