Cathie Wood sees 13x surge in Zoom by 2026, targets $1,500 stock price
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Cathie Wood and ARK Invest made an aggressive call that Zoom Video Communications (NASDAQ:ZM) could reach a stock price of $1,500 by 2026. That would equate to more than 13 times its current stock price of around $112 and would represent compounding annual growth of 76%.
Wood, who has long been a bull on ZM, noted that ARKâs bull case scenario suggests that the stock could rise as high as $2,000. Even her bear case points to a stock price of $700 -- more than 6x current levels.
For more reference, Zoom traded at $112.15 in Thursday's early action and reached as high as $588.84 during the peak of COVID lockdowns back in Oct. of 2020. Since ZMâs peak, the video communication firm has crashed 80%.
At the moment, the two exchange traded funds that have the largest portfolio weightings in ZM are two of Woodâs actively managed funds. The innovation-focused investment groupâs flagship ARK Innovation ETF (NYSEARCA:ARKK) holds the most significant weighting in ZM at 9.49%. This equates to a $856.57M market value and places ZM as ARKKâs number one holding.
Following ARKK is the ARK Next Generation Internet ETF (NYSEARCA:ARKW) which lists ZM as the fund's second largest holding at 8.14% with a market value of $130.73M.
In generating the price target on Zoom, ARK analyzed the adoption of hybrid/remote working models, ZMâs monetization of its user base, evaluation of gross margins, projections of the companyâs EV/EBITDA, as well as other factors. See the complete price target note by Ark Invest.
Year-to-date price action: ZM -37.3%, ARKK -52.6%, and ARKW -51.1%.
In other ARK news, Cathie Wood scooped up more than 50K additional shares of Roku (ROKU) on Tuesday further solidifying ARKK as the largest holder of ROKU compared to any other fund on the market.