Shares of corporate video solutions designer Zoom Video Communications Inc. (ZM), settled at a loss of -1.10 percent to $399.15 on Monday. The stock remained more volatile after emergence of the vaccine news last week. The vaccine announcement by Moderna Inc (MRNA) this week has also been adding to that as the Covid-19 vaccine is anticipated to be available in the next year, a scenario which will lessen the demand of video services solutions.
A report about the rise in the number of cases of COVID-19 in the United States was the catalyst of the growth of ZM stock in last week when it surged 3.7 percent on Thursday. According to Johns Hopkins University, there were more than 140,000 new cases on Wednesday, November 11th which now has been worsened to 164,000. The number of hospital admissions is growing, which places an increased pressure on the healthcare industry.
The situation in the US is worse than it was in the spring of 2020 by a variety of parameters, and some of U.S. States have imposed new restrictions on social activities. Michael Osterholm, President-elect Joe Biden’s advisor last week said that a new nation-wide lockdown could be required for up to six weeks. Restrictions will also require remaining in effect until the commencement of mass vaccination.
Such gloomy news pushes investors, including Zoom Video shares, to seek safe-haven assets. During the new isolation period, demand for video communication services, distance learning conferences and work may increase, and Zoom may be the beneficiary of this development.
Zoom’s revenue increased exponentially during the preceding period of the coronavirus pandemic. It increased 355 percent, to $663.5 million in the second quarter, and adjusted net income increased to $274.8 million, nearly 10 times.
A new boost to financial results of Zoom Video Communications Inc. (ZM) can be offered by busy hospitals and stricter forced self-isolation measures. The company added more than 4 times to its value since start of the year.