ZM stock zoomed up the chart on February 3, 2020, as more people and workers move to teleconferencing to avoid direct contact and to shelter at home as the coronavirus spreads.
Bullish options flow was also detected in ZM stock on February 3, 2020.
Large players volume has been rising in ZM stock for several months now:
The coronavirus is likely fostering Zoom’s upward move. China extended the Lunar New Year celebration through Sunday in an effort to keep the virus from spreading, but some regulatory agencies and businesses are telling workers to stay home longer which could mean increased work completed on teleconferences.
Investors are betting on paid user growth as a consequence of increased cloud video usage because of concerns around physically meeting due to the coronavirus. China doesn’t represent a significant business for Zoom, even though 80% of the engineering team resides there. So one has to wonder if traders are betting on a continued coronavirus outbreak in many countries beyond China that Zoom has teleconferencing business in.
The recent buying in ZM stock could have little to do with the coronavirus. Yuan noted on Mad Money that the market for video conferencing is enormous and expected to be $43B by 2023. Yuan added, “Logitech (LOGI) is a great partner for us” and was confident that Zoom’s platform is far better than other services.
Another reason for the run-up in ZM stock today could be that a competing service from Microsoft (MSFT) Teams suffered a temporary outage. Microsoft confirmed that its Team’s service was down earlier today, stating in a tweet later in the morning that it had determined that an authentication certificate had expired, causing users to have problems using the service.