Question

In the COVID-19 pandemic, Zoom served as one of the go to medium for online communication and has been one of the few companies to shine in the stock market crash.
In relation to innovation, entrepreneurship and platform vs pipeline business strategy, explain:
(i) whether you think the company will continue to grow after the pandemic, AND
(ii) whether the increase in stock value relates to irrational exuberance

Answer 1

Answer

1)

Yes, i believe that the company will continue to grow even after the pandemic. This is because this is a new and innovative technology/ means of communication that various schools, colleges, businesses, and other institutions have adopted for communication. They must have realised the ease of communication that is there because of the presence of such a platform. Also, this platform is east and a fast mode of communication. Thus, i beleive it will become a habit of quite a few institutions to continue to hokd their meetings/ lectures/ seminars on Zoom.

2)

Stock Price of a company increases if the investors find the business of that company promising enough in the near future. It is not right to think of it as irrational exuberance of investors as this kind of technological usage for far due. This kind of advancement was required to go completely digital. Hence, i believe the stock price of this company will continue to rise as it is a promising business.