Zoom is poised to be one of the most richly valued tech companies after it goes public

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At the top end of its pricing range, Zoom would be worth over $8 billion and investors are paying a high multiple relative to its peers.

Amid all the hype surrounding this year's big consumer IPOs like Lyft, Pinterest and Uber, investors seem most excited about the debut of a company that sells video-conferencing software to businesses — Zoom.

Zoom's success is built on the simplicity of its technology compared with older video and collaboration products from Microsoft, Cisco and Citrix. The service gained popularity at start-ups and with small teams and has emerged more recently as a package of tools used across large enterprises through what the company describes in its online roadshow as a"viral adoption model.

If you look at Zoom's peers — cloud software companies valued at $1 billion or more — only Zscaler, Okta and Atlassian trade at a premium to its projected multiple, according to FactSet. If Zoom were to price at $32 and go up a fairly modest 30 percent in its debut, it would have a similar multiple to Zscaler.Because of Zoom's 118 percent growth rate, the stock could be considered cheap, even at these lofty multiples. Zscaler's revenue increased 50 percent in its latest fiscal year, while Okta grew 54 percent and Atlassian by just over 40 percent.

 

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it shouldn’t be. Zoom does nothing better then competitors ..

ZOOM into my investment portfolio🤣

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