Zoom Stock Rises on Strong Buy Recommendation and Undervalued Potential
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 24 2024
0mins
Should l Buy ZM?
Source: Business Insider
Zoom Communications Inc. saw its stock price increase by 3.71%, reaching a 20-day high of $92.03, outperforming the S&P 500's decline.
The rise in Zoom's stock is attributed to a strong buy recommendation from Spruce Point Capital, which highlighted the company's undervalued potential and urged for a $4 billion share buyback plan. Additionally, Spruce Point's analysis emphasized Zoom's significant stake in AI leader Anthropic, suggesting that the market has not fully recognized its value.
This positive sentiment around Zoom's stock reflects investor confidence in its long-term growth prospects, especially as it continues to enhance its position in the competitive video communications sector.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy ZM?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on ZM
Wall Street analysts forecast ZM stock price to fall
20 Analyst Rating
12 Buy
7 Hold
1 Sell
Moderate Buy
Current: 109.100
Low
85.00
Averages
99.33
High
115.00
Current: 109.100
Low
85.00
Averages
99.33
High
115.00
About ZM
Zoom Communications, Inc. provides an artificial intelligence (AI) work platform for human connection. Zoom Workplace, the Company’s AI-powered, open collaboration platform built for modern work, enables us to streamline communications, increase employee engagement, optimize in-person time, improve productivity, and offer customer choice with third-party apps and integrations. Zoom Workplace, powered by Zoom AI Companion, includes collaboration solutions like meetings, team chat, phone, scheduler, whiteboard, spaces, Workvivo, and more. Its communication products include Zoom Meetings, Zoom Phone, Zoom Team Chat, Zoom scheduler, and Zoom mail and calendar. Its productivity products include Zoom Docs, Zoom Whiteboard, Zoom Clips, and Zoom Tasks. Its space products include Zoom Rooms, Zoom Workspace Reservation, and Zoom Visitor Management. It serves various industries, including education, financial services, government, retail, manufacturing and healthcare.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Casey's General Stores Joins S&P 500, Boosting Market Position
- S&P 500 Inclusion: Casey's General Stores (CASY) officially joined the S&P 500 on April 9, replacing Hologic (HOLX), which is expected to enhance its market visibility and drive stock price appreciation, evidenced by a 7% increase in the past week.
- Strong Financial Performance: In the latest quarter, Casey's reported diluted EPS of $3.49, nearly a 50% year-over-year increase, and EBITDA of $309 million, up 27.5%, showcasing robust revenue growth amid rising gas prices.
- Zoom's Investment Value: Zoom Communications (ZM) invested $51 million in Anthropic in May 2023, with analysts estimating the stake's current value between $2 billion and $4 billion, as Anthropic approaches a valuation of $900 billion, significantly enhancing Zoom's market potential.
- eBay Acquisition Dynamics: eBay (EBAY) shares surged 12% following news of GameStop's acquisition proposal, with CEO Ryan Cohen quietly building a stake, indicating potential for increased market positioning despite the mismatch in company sizes.
See More
Wall Street Optimistic on Three Tech Stocks' Rebound
- Figma's Positive Outlook: Despite Figma's stock plummeting 68% in 2025 and another 49% this year, analysts believe its 12-month price target is approximately 114% above the current share price, reflecting confidence in its strong growth, particularly with a 40% year-over-year revenue increase and a 136% net dollar retention rate in Q4.
- ServiceNow's Buying Opportunity: ServiceNow's stock has dropped over 40% in 2026, yet analysts view this as a buying opportunity with a potential upside of over 60%, as 43 out of 48 analysts rated it as a
See More
Zoom Adjusts Parental Leave Policy Amid Rising Costs
- Parental Leave Reduction: Zoom has cut paid parental leave for birthing employees from 22-24 weeks to 18 weeks, while non-birthing parents now receive 10 weeks instead of 16, reflecting the company's strategy to control costs amid rising healthcare expenses.
- Market Comparison Pressure: As healthcare costs rise, more companies are scrutinizing employee benefits, particularly parental leave, with many focusing on this area for cuts as they set 2027 budgets, indicating competitive pressures within the industry.
- Policy Adjustment Trend: According to Gallagher's Shauna Bryngelson, many companies are reassessing their parental leave policies to better align with state-led paid leave programs, which typically offer around 12 weeks, prompting a search for a more sustainable balance within the 4-12 week range.
- Overall Industry Changes: Despite cuts from companies like Zoom and Deloitte, a Brown & Brown survey found that 71% of employers still offer paid parental leave beyond state requirements, with 69% planning to increase benefit amounts or durations, indicating that many firms are expanding their benefits in response to competitive pressures.
See More
2023 Shaping Up to Be the Year of Mega IPOs: Anthropic and Investor Dynamics
- SpaceX IPO Outlook: SpaceX's planned IPO is projected to be the largest in history, with a valuation of up to $1.75 trillion to $2 trillion, indicating strong demand for tech companies and heightened investor confidence.
- Anthropic's IPO Potential: AI company Anthropic is expected to go public by year-end, potentially achieving a market valuation of $1 trillion, reflecting rapid growth in the AI sector and investor optimism about its future development.
- Alphabet's Investment Moves: Google invested $300 million in Anthropic in April 2023 for a roughly 10% stake, followed by commitments of up to $2 billion in additional funding, further solidifying its strategic positioning in the AI landscape.
- Amazon's Funding Commitment: In September 2023, Amazon pledged up to $4 billion to Anthropic, including $1.25 billion upfront, demonstrating its focus on AI technology and confidence in future growth potential.
See More
Anthropic Set to Go Public by Year-End at $1 Trillion Valuation
- IPO Outlook: AI company Anthropic is expected to go public by the end of the year with a valuation of $1 trillion, marking 2023 as a year of mega IPOs and attracting significant investor interest.
- Investor Exposure: Investors can gain exposure to Anthropic by purchasing shares in its early investors, including Alphabet, Salesforce, Zoom, and Amazon, thereby enhancing portfolio diversification.
- Alphabet's Investment: Google invested $300 million in Anthropic in April 2023, securing approximately a 10% stake, and pledged up to $2 billion in subsequent funding rounds, demonstrating strong confidence in the AI sector.
- Participation from Zoom and Amazon: Zoom participated in Anthropic's Series C funding in May 2023, with strategic investments indicating its commitment, while Amazon pledged up to $4 billion in support, further solidifying its leadership in the cloud services market.
See More
SiriusXM and Zoom Options Trading Volume Surge
- SiriusXM Options Volume: As of now, SiriusXM's options trading volume has reached 65,272 contracts, equivalent to approximately 6.5 million shares, exceeding 105.9% of its average daily trading volume of 6.2 million shares over the past month, indicating strong market interest in the stock.
- High-Frequency Contracts: Within SiriusXM, the $30 strike call option has been particularly active, with 12,120 contracts traded today, representing about 1.2 million shares, suggesting investor expectations for future price increases.
- Zoom Options Activity: Meanwhile, Zoom's options trading volume stands at 42,943 contracts, representing approximately 4.3 million shares, achieving 102.2% of its average daily trading volume of 4.2 million shares over the past month, reflecting ongoing investor interest in the company.
- Zoom High-Frequency Contracts: For Zoom, the $65 strike put option has seen a trading volume of 5,003 contracts, representing around 500,300 shares, indicating a cautious market sentiment regarding its future performance.
See More
Casey's General Stores Joins S&P 500, Boosting Market Position
- S&P 500 Inclusion: Casey's General Stores (CASY) officially joined the S&P 500 on April 9, replacing Hologic (HOLX), which is expected to enhance its market visibility and drive stock price appreciation, evidenced by a 7% increase in the past week.
- Strong Financial Performance: In the latest quarter, Casey's reported diluted EPS of $3.49, nearly a 50% year-over-year increase, and EBITDA of $309 million, up 27.5%, showcasing robust revenue growth amid rising gas prices.
- Zoom's Investment Value: Zoom Communications (ZM) invested $51 million in Anthropic in May 2023, with analysts estimating the stake's current value between $2 billion and $4 billion, as Anthropic approaches a valuation of $900 billion, significantly enhancing Zoom's market potential.
- eBay Acquisition Dynamics: eBay (EBAY) shares surged 12% following news of GameStop's acquisition proposal, with CEO Ryan Cohen quietly building a stake, indicating potential for increased market positioning despite the mismatch in company sizes.
See More
Wall Street Optimistic on Three Tech Stocks' Rebound
- Figma's Positive Outlook: Despite Figma's stock plummeting 68% in 2025 and another 49% this year, analysts believe its 12-month price target is approximately 114% above the current share price, reflecting confidence in its strong growth, particularly with a 40% year-over-year revenue increase and a 136% net dollar retention rate in Q4.
- ServiceNow's Buying Opportunity: ServiceNow's stock has dropped over 40% in 2026, yet analysts view this as a buying opportunity with a potential upside of over 60%, as 43 out of 48 analysts rated it as a
See More
Zoom Adjusts Parental Leave Policy Amid Rising Costs
- Parental Leave Reduction: Zoom has cut paid parental leave for birthing employees from 22-24 weeks to 18 weeks, while non-birthing parents now receive 10 weeks instead of 16, reflecting the company's strategy to control costs amid rising healthcare expenses.
- Market Comparison Pressure: As healthcare costs rise, more companies are scrutinizing employee benefits, particularly parental leave, with many focusing on this area for cuts as they set 2027 budgets, indicating competitive pressures within the industry.
- Policy Adjustment Trend: According to Gallagher's Shauna Bryngelson, many companies are reassessing their parental leave policies to better align with state-led paid leave programs, which typically offer around 12 weeks, prompting a search for a more sustainable balance within the 4-12 week range.
- Overall Industry Changes: Despite cuts from companies like Zoom and Deloitte, a Brown & Brown survey found that 71% of employers still offer paid parental leave beyond state requirements, with 69% planning to increase benefit amounts or durations, indicating that many firms are expanding their benefits in response to competitive pressures.
See More
2023 Shaping Up to Be the Year of Mega IPOs: Anthropic and Investor Dynamics
- SpaceX IPO Outlook: SpaceX's planned IPO is projected to be the largest in history, with a valuation of up to $1.75 trillion to $2 trillion, indicating strong demand for tech companies and heightened investor confidence.
- Anthropic's IPO Potential: AI company Anthropic is expected to go public by year-end, potentially achieving a market valuation of $1 trillion, reflecting rapid growth in the AI sector and investor optimism about its future development.
- Alphabet's Investment Moves: Google invested $300 million in Anthropic in April 2023 for a roughly 10% stake, followed by commitments of up to $2 billion in additional funding, further solidifying its strategic positioning in the AI landscape.
- Amazon's Funding Commitment: In September 2023, Amazon pledged up to $4 billion to Anthropic, including $1.25 billion upfront, demonstrating its focus on AI technology and confidence in future growth potential.
See More
Anthropic Set to Go Public by Year-End at $1 Trillion Valuation
- IPO Outlook: AI company Anthropic is expected to go public by the end of the year with a valuation of $1 trillion, marking 2023 as a year of mega IPOs and attracting significant investor interest.
- Investor Exposure: Investors can gain exposure to Anthropic by purchasing shares in its early investors, including Alphabet, Salesforce, Zoom, and Amazon, thereby enhancing portfolio diversification.
- Alphabet's Investment: Google invested $300 million in Anthropic in April 2023, securing approximately a 10% stake, and pledged up to $2 billion in subsequent funding rounds, demonstrating strong confidence in the AI sector.
- Participation from Zoom and Amazon: Zoom participated in Anthropic's Series C funding in May 2023, with strategic investments indicating its commitment, while Amazon pledged up to $4 billion in support, further solidifying its leadership in the cloud services market.
See More
SiriusXM and Zoom Options Trading Volume Surge
- SiriusXM Options Volume: As of now, SiriusXM's options trading volume has reached 65,272 contracts, equivalent to approximately 6.5 million shares, exceeding 105.9% of its average daily trading volume of 6.2 million shares over the past month, indicating strong market interest in the stock.
- High-Frequency Contracts: Within SiriusXM, the $30 strike call option has been particularly active, with 12,120 contracts traded today, representing about 1.2 million shares, suggesting investor expectations for future price increases.
- Zoom Options Activity: Meanwhile, Zoom's options trading volume stands at 42,943 contracts, representing approximately 4.3 million shares, achieving 102.2% of its average daily trading volume of 4.2 million shares over the past month, reflecting ongoing investor interest in the company.
- Zoom High-Frequency Contracts: For Zoom, the $65 strike put option has seen a trading volume of 5,003 contracts, representing around 500,300 shares, indicating a cautious market sentiment regarding its future performance.
See More
