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Zoom is surging: Will the stock sustain bull run?

"Work is no longer a place, it’s a space where Zoom serves to empower your teams to connect and bring their best ideas to life," - Eric S. Yuan, CEO of Zoom Video Communications.

Zoom is surging: Will the stock sustain bull run?

The video conferencing company Zoom Video Communications (NASDAQ: ZM) shares gained more than 20% since the start of June 2021 after a couple of months downside move. Zoom stock considered one of the biggest winners during the pandemic time and it hit its all-time high of $588.84 in October 2020.

The Zoom app was founded in 2011 by Eric Yuan and launched in January 2013. Zoom started trading on the stock market in April 2019 and initially priced at $36 were trading for $65 on the first day of trading. In 2020, the app has gained huge popularity and it became a focal point of life during the pandemic, as people use them for education, meetings, and jobs etc.

Zoom stock was struggling to find the upside momentum in the first quarter of 2021. The positive vaccine optimism and global economic recovery made an immediate effect on Zoom shares as hopes were raised that people won’t spend the rest of their lives on video calls. During the month of May, zoom shares started to rebound after it finally found strong buyers below the $300 demand area. The upside rally also supported by the steady stream of positive news and strong financial results.

ZOOM: Q1 EARNINGS SNAPSHOT

Zoom last posted its quarterly earnings results on Monday, May 31st that topped Wall Street estimates. The company reported $1.32 earnings per share for the quarter and posted revenue of $956.2 million for the quarter, compared to analysts' expectations of $908.17 million. For the full financial year, Zoom now forecasts its per-share earnings to fall in the range of $4.56 to $4.61. The company subsequently raising its revenue guidance for fiscal 2022 to between $3.975 billion and $3.990 billion.

"We kicked off the fiscal year with a very strong first quarter, posting 191% total year-over-year revenue growth combined with strong profitability and cash flow." - Eric S. Yuan, CEO of Zoom said in the company's first-quarter earnings release. "We are energized to help lead the evolution to hybrid work that allows greater flexibility, productivity, and happiness to both in-person and virtual connections," he added.

$ZM: TECHNICAL ANALYSIS

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Zoom stock price is currently trading at around $400. Technically the overall momentum remains bullish throughout the last couple of weeks. In the coming days, if the bullish momentum continues the next upside levels to watch $450 (this year high) then $480/500. On the downside, any meaningful pullback now seems to find some support near the $350 zones, below which the slide could further get extended towards the $330/00 region.

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