Will Zoom Communications Ever Pay A Dividend?

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Digital communications company Zoom Video Communications (ZM) has been perhaps one of the biggest winners of the year, thriving in an environment where physical contact has been greatly reduced. With pandemic conditions persisting for many organizations, Zoom has been at the right place at the right time.

Zoom has been one of the market’s premier momentum stocks, as its stock price has increased by more than 6x just since the beginning of the year. Zoom is now a large-cap stock with a market cap above $100 billion.

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Zoom’s market capitalization has boomed as its prospects have improved, but given that it is still quite early on in its growth cycle, it doesn’t yet return capital to shareholders. For income-focused investors, the question then becomes one of whether Zoom will ever pay a dividend to shareholders.

In this article, we will explore Zoom’s business and the likelihood that the company could begin returning capital to shareholders at some point.


Business Overview

Zoom offers a suite of digital communications products that enable its customers to have face-to-face experiences across devices and locations. The company offers video, voice, chat, and content sharing products to bridge the gap between being remote and being in-person.

Zoom enables users to attend the same meeting in a scalable and easy-to-deploy platform. Zoom is mostly concentrated in the US, but is a global company, selling its services all over the world.

The company counts an enormous number of organizations among its client list, including educational institutions, entertainment and media companies, financial firms, governments, healthcare companies, manufacturers, nonprofits, retailers, and also individuals.

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Adam Reynolds 8 months ago Member's comment

#Zoom was a no brainer for the pandemic, but now that we're finally seeing the light at the end of the tunnel, I wonder how much juice $ZM will have once its over. It's not like schools will go back to it once they can have in class learning again, or that people will opt to get married over zoom.