Attention, investors: better to double check which Zoom you are negotiating and we don’t want to tell you again … and again.
The SEC has suspended trade in Zoom Technologies, a small Chinese technology company often confused with Zoom Video Communications (ZM) – Get Report, the hot video conferencing stock that rose in price during the coronavirus pandemic.
Shares in the much smaller Zoom rose 23% on Thursday when the SEC stepped in to suspend trading. The agency cited “concerns about investors confusing this issuer with a similarly listed NASDAQ issuer, providing communication services, which saw a rise in the share price during the current COVID-19 pandemic.”
Zoom Video Communications, which offers virtual conferencing software, has seen an unprecedented surge in use this year as workers remain at home en masse to combat the spread of coronavirus. And its share price has gone up on par, with stocks rising more than 100% since the beginning of this year.
As for the smaller Zoom, his shares more than doubled over the course of two trading sessions last week along with a spike in his biggest namesake’s trading activity.
The misunderstanding has already happened before: shortly after Zoom’s IPO last April, Zoom Technologies’ stock increased by 56,000% in 30 days, partly fueled by the confusion with Zoom Communications.
Zoom Video Communications recorded a 105% increase over the previous year and is widely used by companies that are forced to work from home and for personal use for those who are quarantined during the coronavirus pandemic.
TheStreet and Sports Illustrated speculated whether the NFL and Zoom Video could come together for a partnership to broadcast the NFL draft after the Las Vegas draft was canceled.
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