Please ensure Javascript is enabled for purposes of website accessibility
Free Article Join Over 1 Million Premium Members And Get More In-Depth Stock Guidance and Research

Why Zoom Video Stock Popped Today

By Chris Neiger - Jan 4, 2021 at 12:08PM

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

News of the slow distribution of COVID-19 vaccines could be causing Zoom's stock to rise.

What happened

Shares of Zoom Video Communications ( ZM -4.08% ) are rising today as cases of COVID-19 continue to rise and a vaccine rollout appears to be taking longer than expected in the U.S.

The tech stock was up by as much as 7.6% and had gained 5.4% as of 11:58 a.m. EST. 

So what 

Technology stocks were a haven in 2020 for investors as lockdowns and social distancing forced many people to rely on technology for work and social activities. Perhaps no company benefited more from these social restrictions than Zoom, whose video services have become the preferred tool for video calls. 

A bar graph on a blue background.

Image source: Getty Images.

The coronavirus continues to spread quickly across the U.S. and distribution of several COVID-19 vaccines appears to be taking longer than some had expected. If people in the U.S. aren't able to get the vaccines quickly, many businesses will continue to be shuttered or scaled back, which will exacerbate the already-shaky economic recovery.

All of this matters for Zoom's business because the longer social distancing and lockdowns are the norm, the more people will rely on the company's video service to meet with friends and family and conduct business.

With today's mild share price jump, Zoom's stock has gained 428% over the past 12 months.  

Now what

There's still a lot of uncertainty surrounding the U.S. economic recovery, which means that Zoom's stock could continue to respond to coronavirus and vaccine-related news. Zoom investors should consider the long-term prospects of the company and try not to react to the daily stream of news.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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

Zoom Video Communications Stock Quote
Zoom Video Communications
ZM
$183.92 (-4.08%) $-7.83

*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 service.

Stock Advisor Returns
624%
 
S&P 500 Returns
141%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 12/05/2021.

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

Our Most Popular Articles

Premium Investing Services

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