Zoom stock has skyrocketed nearly 5x this year on the backdrop of massive demand owing to the work-from-home culture and more businesses moving online. Zoom investors had a phenomenal bull run in 2020.
While the entire world was gripped under the COVID-19 pandemic, it has unlocked new fortune for some companies. Especially, the tech sector has registered superb growth with offices pushing work-from-home and more businesses turning online. Zoom Video Communications (NASDAQ: ZM) is one such tech company that had a mammoth stock run this year.
The cloud-based communications technology company witnessed massive demand for its video conferencing app after governments worldwide started initiating lockdown measures. Zoom was poised to take up this opportunity at the very moment. During April-May-2020, the number of Zoom app downloads reached its peaks and continued over the coming months.
Zoom (NASDAQ: ZM) stock has registered an unprecedented bull run today. Zoom CEO Eric Yuan has climbed many ranks in the world’s richest list. However, it hasn’t been all a smooth ride for the CEO as well. Around April 2020, Zoom faced data privacy issues with a number of users reporting about it. Several people called it a Chinese application. House Speaker Nancy Pelosi also referred to Zoom as a Chinese entity on live television. Responding to this, CEO Eric Yuan wrote:
“I became an American citizen in July 2007. I have lived happily in America since 1997. Zoom is an American company, founded and headquartered in California, incorporated in Delaware and publicly traded on Nasdaq.”
Zoom Stock Remains on Analysts Radar
Zoom stock has been one of the top-performer on Wall-Street. ZM stock surged all the way to $568 levels by mid-October 2020. However, the stock has been sideways since then and has corrected over 30% so far. At the last trading session close, ZM stock was trading at a price of $375.
Despite the correction, ZM stock is trading at nearly 400% year-to-date. As per the current forecasts, the fourth-quarter revenue is likely to grow by more than 315% year-over-year. analysts think that the diluted EPs will also jump by five-fold during the same period.
But many analysts think that the COVID-19 pandemic has already front-loaded much of this price increase. Thus, they have projected only a 3% surge in revenue for the year 2021. The analysts note that the ZM stock surge has already priced-in the company’s growth. Thus, it would be currently more prudent to wait and watch for the time being.
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