Why did zoom stock go up - why did zoom stock go up:
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Why did zoom stock go up - why did zoom stock go up:
Barker: Yes. What can I add? We were discussing whether this quarter is in the hall of fame for a publicly traded stock quarters or whether it just goes straight to Mount Rushmore as one of the very elite, perhaps only four of all-time; I'd like to know what others are in the competition for this. Hill: Yeah. And it's funny I forget who it was, but I saw an analyst this morning on CNBC basically throw his hands up and just -- and I likened it to, in the same way that a lot of companies have come out during the pandemic and said, we're not giving guidance anymore, there's too much uncertainty we're not giving guidance for the rest of the fiscal year.
This analyst was basically doing the same thing with Zoom Video, like, I don't know what to do with this valuation. So, it was almost like he wanted to leave the set, like, stop asking me about this, I don't know what to do.
Barker: Yeah. Well, I think that, I mean, one of the reasons that I would put it on the Mount Rushmore, consider it being one of the ones that goes there, is that the stock price is much more correlated with the growth in the business, the improvement in the stock price, than some other things which have had unbelievable years as stocks and good years as businesses.
I would include, sort of, Tesla in that, where Tesla is up, I think the stock is up 10X this year or 10X over a year period of time. They're not selling 10X as many cars today as they were a year ago. They've done a great job, they've improved all around, but the stock price is traveling on a different path than the business there at the moment. Whereas, I would say, there's a little bit of a tighter fit between the growth in Zoom.
And, you know, the guidance they provided was actually quite conservative for the next quarter and the rest of the year, really just barely above what they just did. Hill: I don't know when Cisco Systems' next earnings report comes out, but whenever that is, I'm looking forward to any questions that analysts ask on the conference call about WebEx and using Zoom Video as a datapoint. Just like, well, we see what Zoom was able to do in terms of growth, I know you have other businesses at Cisco Systems, we know you have other things going on, my question is about WebEx, how's that going?
Barker: No, no. I mean, a closer corollary for that kind of growth might be RingCentral which has got, sort of, a unified communications cloud-based business operation, and just reported a very good quarter in their own right, not quite at Zoom level. So, obviously, this is a technology which we are using right now. We're probably familiar with how much more we use it not just in business and not just for an expanding part of our business, because we had Zoom a year ago, more than a year ago in our company, used it, we found it, I think I did, I'm imagining you did a big improvement over our previous video conferencing software.
And you know, now it's the kind of thing that grandparents and grandchildren and parents are all using in a way, and adoption across generations that I think is also on a fairly shortlist of technologies that have seen, you know, all of society go into this, and to becomes of verb of what you're doing. And Schlumberger is going to hold a big stake in the resulting company. And this is one of those deals that strikes me as pretty one-sided.
This seems like this is good for Liberty shareholders and maybe no one else. I was going back, looking over a graph. And Schlumberger has had phenomenal success over the years, it's been one of the innovators in the category and yet its stock is about the same price it was in So, you know, to me, more than anything, I take away that this is a part of the economy that the market does not like today, the market does not see a promising future for. Liberty has improved, but is really, sort of, getting up off the canvas with this deal, it does not appear to have the future, that it once appeared to have, today, as reflected by stock market prices and as reflected by people's use of fossil fuels at this moment in time.
If you want to take the other side of that, that this is a cycle and this is all going to come back then, you know, why don't you take that?
We said we would try to generate a fight with -- that's what you've always said, fossil fuels, just give me more fossil fuels. Hill: I haven't said that, but certainly, you know, to go back to Zoom's valuation, in the same way that there are people looking at the valuation of Zoom Video and saying, this is insane, some of those same people are looking at Schlumberger and Chevron and ExxonMobil and saying, look at how cheap these stocks are.
You know who didn't say that, the people of Dow Jones and their average; they kicked Exxon out. So, they're not betting on the future.
And if Dow Jones, which is the epitome of the status quo and the elite of the anointed in an economy, if they're not as interested in betting on the present and the future of Exxon as they once were, and were for decades, that's sort of just another, perhaps, data point as to how many people are getting off the train. Now, that's one way to make money, is to pick up something that everybody else has turned on, but you are betting, you are betting on the future of fossil fuels.
And I don't know if that's a bet everybody wants to make. And, I mean, one of the reasons would be to look back on the last 25 years of Schlumberger and what shareholders have received for sticking it out with them this long. And they've seen a company that's been at the core of the innovations that made fracking possible and made fracking as lucrative as it was during the right part of the cycle.
But we're on the other part of the cycle right now. And talking about this as a cyclical, we are implying that, you know, there will be another chapter and it'll look a little different on the sine curve. But long-term, I do take that year view and say, sigh, I'm not sure the next 25 years are going to be better than the last 25 for Schlumberger.
Hill: Just last thing on this. When you started to talk about Schlumberger's stock price and you said, the stock is basically where it was in I didn't know what year you were going to say, but I would have bet money it was at least going to be a year in this century, the fact that the stock is basically where it was in , means that there are absolutely people listening to this podcast going, wait a minute, that was before I was born.
Like, yep, that's how that's going for Schlumberger. I haven't gone back and matched this graph up against any divestments that may have occurred. So, if I've gotten any part of this not fully accurate, that's on me, but I think that the general story is going to hold up to scrutiny.
What was your reaction when you saw the details of this service? Let's just start there. Barker: My initial reaction was, this is a copycat of Amazon , and that's probably a pretty good idea. I think that they have built up their e-commerce.
They weren't rushing into it once coronavirus hit, they've been investing in this for a very long time. And I think that they are going to be a big player and I think that they have got an audience, they're already a big player in e-commerce, but they're going to have an audience that has grown up with Walmart and is loyal to Walmart and appreciates where Walmart is and what it's done for them.
And I think the distribution that they're going to be able to achieve, particularly on the grocery side, given the number of locations, given the scale of those locations, I think I would be-I and the market are buyers of this idea today. Keep reading. Search markets. News The word News. My Watchlist My Watchlist. Carmen Reinicke. Share icon An curved arrow pointing right. Twitter icon A stylized bird with an open mouth, tweeting.
Twitter Link icon An image of a chain link. It symobilizes a website link url. Copy Link. The video conferencing company has surged in popularity as people are forced to work from home and socially distance amid the coronavirus pandemic. Watch Zoom trade live on Markets Insider. Read more on Business Insider.
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