ZM: Adding Zoom to Investing Ideas (Long Side)

Hedgeye CEO Keith McCullough is adding Zoom (ZM) to the long side of Investing Ideas. Below is a brief note.

It's an interesting macro market day with a lot of action inside a US Equity index that was marked up via SPY FOMO futures pre-open...

There's a big correction going on in the "COVID" winner basket.

From Zoom's (ZM) perspective, quantitatively, it’s just a correction towards the low-end of its Risk Range. Fundamentally, here are some recent thoughts from Technology analyst Ami's Joseph's Institutional Research on the name:

Adoption measurements show a) sustaining rate for Zoom, growth for Teams, and volatility in others, b) organizations using 2-3 tools on average, c) ~32% presence for Zoom in survey of 123 public companies, d) surveys show Zoom is consistently #1 by a mile among WFH tools added post COVID Monthly real time billings methodology shows pace of rolling 30-day invoices shipped rising and some volatility on daily billings rate but overall translating to massive growth assuming consistent rates of Revenue + RPO per invoice

Market life is better when you have the patience to buyem on red,

KM