Zoom Stock (ZM): $611 Price Target By AllianceBernstein

By Amit Chowdhry ● October 16, 2020
  • AllianceBernstein nearly tripled its price target for Zoom Video Communications Inc (NASDAQ: ZM) from $228 to a street high of $611.

Over 9 analysts have increased their price targets of Zoom Video Communications Inc (NASDAQ: ZM) following the company’s annual Zoomtopia event, according to MarketWatch. Despite a broader market selloff yesterday, the stock price of Zoom increased 5.33% yesterday from $509.25 to $536.40. Over the past 3 months, the stock price of Zoom more than doubled and it is up about eightfold for the year-to-date. Zoom is one of the few companies that have seen rapid growth due to the pandemic as millions of schools, companies, and other organizations have been relying on the stability of the group video conferencing platform offered by Zoom.

“We believe Zoom’s increasing relevance and continued good execution translate into both near-term and long-term upside,” wrote BofA Securities analyst Nikolay Beliov in a note to clients. “Furthermore, new product releases and enhanced capabilities signal Zoom’s ambition to become a more holistic collaboration and workflow platform, vs a video and (unified communications as a service) solution.”

Beliov had reiterated a buy rating and lifted the price target to $570 from $475. And Beliov also pointed out that the company appears to be in the “very early innings” of monetizing the largest companies around the world. Beliov also noted that Zoom is making significant progress on the Zoom Phone.

Rishi Jaluria of D.A. Davidson also kept the rating of Zoom at a “Buy” and increased the price target from $460 to $600.

“Our main takeaway was although (Zoom) has had strong traction in COVID-19, it is still underpenetrated and faces a massive market opportunity with runway for sustained growth post-COVID-19,” wrote Jaluria in his report.

Stifel Nicolaus analyst Tom Roderick increased the price target to $400 from $350. And he reiterated the hold rating.

“We are conscious of the stock’s egregiously high multiple but there’s no reason to suspect that momentum is slowing here,” explained Roderick.

RBC Capital Markets had affirmed an “Outperform” rating on Zoom Video. And RBC raised its price target from $450 to $600. And RBC said “increased conviction in the potential for durable hypergrowth, with a potential path to 60% growth next year” via TheStreet.

One of the most bullish reports came from AllianceBernstein. AllianceBernstein nearly tripled its price target for Zoom from $228 to a street high of $611.

“Total meeting minutes on Zoom have increased (about 30 times) over the last year,” wrote AllianceBernstein in a note.

This week, Zoom announced new features including an events platform called OnZoom. With OnZoom, users will be able to create and host free, paid, and fundraising events. And Zoom Video now has a product that enables Zoom communications are encrypted with cryptographic keys.

Disclosure: I have a small position in Zoom stock in my portfolio.