What happened
Shares of Zoom Video Communications (ZM +1.35%) rallied on Friday following positive commentary from an analyst. Zoom closed the trading session up by 11.6%.
NASDAQ: ZM
Key Data Points
So what
On Thursday, Zoom said it struck a deal to acquire Solvvy, which owns an artificial intelligence-powered automation platform for customer support. Zoom intends to use Solvvy's conversational AI expertise to strengthen its contact center platform, which integrates video, voice, text, and webchat functionality.
"Solvvy's differentiated AI and machine learning technology, deeply talented team, and an easy-to-deploy solution will help accelerate our roadmap to creating a concierge-level experience for customers worldwide," said Zoom executive Velchamy Sankarlingam in a press release. "Together, we are excited to help businesses of all sizes improve their customer retention, increase operating efficiency, and set new standards for customer service and satisfaction."
Image source: Getty Images.
On Friday, BTIG analyst Matt VanVliet reiterated his buy rating on Zoom. He views the cloud communications leader's deal with Solvvy as a sign of things to come. VanVliet also expects Zoom to use a portion of its hefty cash reserves to scoop up other software-as-a-service providers to further enhance and differentiate its cloud-based offerings.
VanVliet now expects Zoom's stock price will rally to $150 per share over the next 12 months. Though that price target is down from his prior target of $180, it still represents a potential gain of roughly 58% from the stock's current price near $95.
Now what
Investors can expect to receive an update on Zoom's growth strategy when it releases its fiscal 2023 first-quarter financial results on May 23.
