[ad_1]
UPDATE with the closing price. Shares of Covid-19, darling Zoom Video Communications, fell 15% today despite the company’s stellar earnings report rising on Monday.
Some Wall Street analysts have raised concerns that stocks are overvalued after rising 600% in 2020 so far, as businesses, schools, government offices and others flock to Zoom meetings . The stock ended the day at $ 406.31.
Dan Romanoff of Morningstar wrote in a note to clients, “We continue to struggle with the valuation of Zoom and view stocks as overvalued.” Credit Suisse reaffirmed its “underperformance” rating on the company’s shares, although it raised its 12-month price target from $ 315 to $ 340 due to blockbuster earnings.
Related story
Brad Parscale says Donald Trump was wrong not to express empathy about Covid-19
For its fiscal third quarter ending Oct. 31, Zoom posted earnings per share of 99 cents, much better than the analyst consensus forecast of 76 cents. Revenue also exceeded Wall Street estimates, rising to $ 777.2 million, nearly five times the $ 166.6 million recorded in the same quarter of 2019.
Zoom CFO Kelly Steckelberg was questioned on Monday during the company’s earnings call with analysts on growth prospects once workers return to offices and students to schools in 2021 and beyond.
“While we are all hoping for a vaccine sooner rather than later, I think the trends in remote working are here to stay,” she said. The features and products that Zoom has rolled out in recent months “will help customers and employees who are considering returning to work in a sort of hybrid work environment.”
An example Steckelberg cited is Smart Gallery, which is designed to improve communication between workers when some are remote and some are in the office. “Customers will continue to want to provide this flexibility to their employees,” she said, which will help strengthen Zoom’s bottom line.
JP Morgan agreed with this optimistic view, raising its 12-month price target on Zoom shares to $ 450 from $ 425 and reaffirming its “buy” rating.
[ad_2]
Source link