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Zoom Forays into Employee Engagement Space: ETFs in Focus
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Zoom Video Communications Inc. (ZM - Free Report) recently announced it is acquiring Workvivo, a leading employee engagement platform. The deal is set to be completed in the first quarter of 2024. The terms of the acquisition were not disclosed. This move is part of Zoom's broader plan to expand its services beyond video conferencing and into the broader realm of workplace productivity and collaboration.
Workvivo is an employee communication and engagement platform that allows organizations to connect their employees across different departments, locations, and levels. The platform provides a social network for employees to share ideas, celebrate milestones, and collaborate on projects in a seamless and engaging way.
Workvivo offers a range of features, including news feeds, recognition badges, polls, surveys, and more, to help organizations improve communication and engagement with their employees.
How Beneficial Would the Acquisition Be?
With the acquisition of Workvivo, Zoom Video aims to enhance its existing video conferencing capabilities with a more comprehensive suite of workplace tools. As soon as the deal is complete, Zoom Video plans to make Workvivo’s features available on its platform.
This acquisition is expected to benefit Zoom in several ways. First, it will help Zoom Video to foray into the employee communication and collaboration platforms space. The acquisition would also make Meta Platform’s (META - Free Report) Workplace, Microsoft’s (MSFT - Free Report) Yammer and Salesforce’s (CRM - Free Report) Simpplr its direct competitors.
Secondly, the acquisition will enable Zoom to tap into a rapidly growing market for employee engagement platforms. With the rise of remote work and the need for businesses to keep their employees connected and engaged, the market for employee engagement platforms is expected to grow significantly in the coming years.
By acquiring Workvivo, Zoom will be able to position itself as one of the leading companies in the employee engagement space and capture a decent share of this market. In the first quarter of financial year 2024, Zoom Video expects growth in revenues of approximately 1% year over year. This growth can be boosted by its acquisition of Workvivo.
Should You Tap the Potential Benefit from the Acquisition With ETFs?
Investors are likely to take note of this acquisition as well. Zoom's stock price has been volatile in recent months, with investors concerned about the company's ability to sustain the rapid growth it experienced during the pandemic.
However, this acquisition signals that Zoom is actively seeking to expand its services and maintain its position as a key player in the technology industry. ZM currently has a Zacks Rank #3 (Hold).
Initially, investors who still have more faith in big players like Meta Platform, Microsoft and Salesforce’s.com may be hesitant in investing in Zoom to play the employee engagement segment. Hence, those individuals can play Zoom-heavy ETFs to play this acquisition news. The ETF approach lessens the company-specific risks.
Zoom-Heavy ETFs in Focus
ETFs like ARK Innovation ETF (ARKK - Free Report) and ARK Next Generation Internet ETF (ARKW - Free Report) have 9.3% and 8.3% exposure to Zoom Video. Zoom takes the second position in each of the funds.
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Zoom Forays into Employee Engagement Space: ETFs in Focus
Zoom Video Communications Inc. (ZM - Free Report) recently announced it is acquiring Workvivo, a leading employee engagement platform. The deal is set to be completed in the first quarter of 2024. The terms of the acquisition were not disclosed. This move is part of Zoom's broader plan to expand its services beyond video conferencing and into the broader realm of workplace productivity and collaboration.
Workvivo is an employee communication and engagement platform that allows organizations to connect their employees across different departments, locations, and levels. The platform provides a social network for employees to share ideas, celebrate milestones, and collaborate on projects in a seamless and engaging way.
Workvivo offers a range of features, including news feeds, recognition badges, polls, surveys, and more, to help organizations improve communication and engagement with their employees.
How Beneficial Would the Acquisition Be?
With the acquisition of Workvivo, Zoom Video aims to enhance its existing video conferencing capabilities with a more comprehensive suite of workplace tools. As soon as the deal is complete, Zoom Video plans to make Workvivo’s features available on its platform.
This acquisition is expected to benefit Zoom in several ways. First, it will help Zoom Video to foray into the employee communication and collaboration platforms space. The acquisition would also make Meta Platform’s (META - Free Report) Workplace, Microsoft’s (MSFT - Free Report) Yammer and Salesforce’s (CRM - Free Report) Simpplr its direct competitors.
Secondly, the acquisition will enable Zoom to tap into a rapidly growing market for employee engagement platforms. With the rise of remote work and the need for businesses to keep their employees connected and engaged, the market for employee engagement platforms is expected to grow significantly in the coming years.
By acquiring Workvivo, Zoom will be able to position itself as one of the leading companies in the employee engagement space and capture a decent share of this market. In the first quarter of financial year 2024, Zoom Video expects growth in revenues of approximately 1% year over year. This growth can be boosted by its acquisition of Workvivo.
Should You Tap the Potential Benefit from the Acquisition With ETFs?
Investors are likely to take note of this acquisition as well. Zoom's stock price has been volatile in recent months, with investors concerned about the company's ability to sustain the rapid growth it experienced during the pandemic.
However, this acquisition signals that Zoom is actively seeking to expand its services and maintain its position as a key player in the technology industry. ZM currently has a Zacks Rank #3 (Hold).
Initially, investors who still have more faith in big players like Meta Platform, Microsoft and Salesforce’s.com may be hesitant in investing in Zoom to play the employee engagement segment. Hence, those individuals can play Zoom-heavy ETFs to play this acquisition news. The ETF approach lessens the company-specific risks.
Zoom-Heavy ETFs in Focus
ETFs like ARK Innovation ETF (ARKK - Free Report) and ARK Next Generation Internet ETF (ARKW - Free Report) have 9.3% and 8.3% exposure to Zoom Video. Zoom takes the second position in each of the funds.