Please ensure Javascript is enabled for purposes of website accessibility

Why ZoomInfo Technologies Shot Nearly 15% Higher on Monday

By Eric Volkman – Jun 8, 2020 at 6:08PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The business intelligence solutions provider is proving to be a drink of water in the desert of recent tech IPOs.

What happened

The stock of business intelligence solutions provider ZoomInfo Technologies (ZI 1.83%) had yet another smashing day on Monday.

The shares have doubled and then some from their IPO price, since making their stock market debut last Thursday just after the company's IPO.

A stock market trading graph.

Image source: Getty Images.

So what

IPOs are all the rage with investors these days. One reason is that there have been precious few of them in the wake of the SARS-CoV-2 coronavirus pandemic -- in fact, ZoomInfo is the first post-lockdown IPO in the tech sector, an ever-fertile field of investor interest. Meanwhile, a resurgent stock market of late has led investors to seek out novel and undervalued companies.

ZoomInfo also ticks several boxes popular with business tech investors -- it operates a proprietary platform, it utilizes artificial intelligence (AI) and machine learning, and its solution is cloud-based. Solid fundamentals help too, like a sizable customer base of roughly 202,000 paid users, and a top line that zoomed 103% higher on a year-over-year basis in 2019. 

On the minus side, ZoomInfo had total long-term borrowings of just over $1.2 billion at the end of 2019. However, the roughly $935 million raised in the IPO should help solve that problem. 

Now what

Investors don't seem concerned that in a post-coronavirus world, some companies will likely trim costs like business intelligence. There are clearly many fervent believers in this company, so we could be witnessing the birth of a new tech star on the market.

 

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

ZoomInfo Technologies Inc. Stock Quote
ZoomInfo Technologies Inc.
ZI
$46.72 (1.83%) $0.84

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
342%
 
S&P 500 Returns
110%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/06/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.