Global communications platform Zoom Video Communications (ZM) has signed an agreement to acquire real-time Machine Translation (MT) solutions startup Karlsruhe Information Technology Solutions (Kites). The terms of the deal have not been revealed. Zoom’s shares closed 1.5% higher on Tuesday. (See Zoom stock chart on TipRanks)
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Zoom’s engineering team will work with Kites’ research scientists to advance MT solutions in a bid to improve the efficiency and productivity of Zoom meetings. This will be achieved by offering multi-language translation capabilities to Zoom users.
The President of Product and Engineering at Zoom, Velchamy Sankarlingam, said, “We are continuously looking for new ways to deliver happiness to our users and improve meeting productivity, and MT solutions will be key in enhancing our platform for Zoom customers across the globe.”
Zoom is considering expanding its team in Germany and opening an R&D center.
Citigroup analyst Walter Pritchard recently reiterated a Hold rating on the stock with a price target of $380 (3.7% downside potential). The analyst said, “Q1 renewal strength wasn’t a pull forward and provides visibility into renewal strength for Q2, though the renewal base from last year is smaller.”
Overall, the stock has a Moderate Buy consensus rating based on 8 Buys, 9 Holds, and 1 Sell. The average Zoom price target of $407.81 implies 3.3% upside potential from current levels. The company’s shares have gained 56% over the past year.
According to TipRanks’ Smart Score rating system, Zoom scores a 9 out of 10, suggesting that the stock is likely to outperform market averages.
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