Eric Yuan is, in many ways, the poster child for the coronavirus economy. His Zoom Video Communications has hosted school lessons, family gatherings and business meetings for more than 300 million participants a day during the pandemic. The stock of the video conferencing site has soared more than 500% this year and Yuan, a Chinese-born immigrant to the US, was at one point worth US$28.6-billion — the 40th wealthiest person on the planet.
That remarkable surge took a hit on Monday after Pfizer said the Covid-19 vaccine it’s developing with BioNTech prevented more than 90% of infections in a study, the most encouraging scientific advance so far in the battle against the virus. Airlines, oil giants and hotel operators surged, but stocks that benefited from lockdowns and work-from-home arrangements, such as Peloton Interactive, Netflix and online supermarket Ocado Group, all slumped.
The key question now is whether those extraordinary gains can hold, or whether people will stop using the services of companies like Zoom after the pandemic ends and they return to the workplace.
“I don’t think the trend around e-commerce, video collaboration or shift-to-cloud will change as a result of the vaccine,” said Bloomberg Intelligence analyst Mandeep Singh. “The valuations look rich for some of these names, but some of these are multiyear growth stories. This is just normal volatility as investors look to rotate into sectors that have been depressed due to the pandemic such as travel, casinos and hospitality.”
Zoom shares fell 13% at 12.30pm in New York, erasing more than $4-billion from Yuan’s net worth. He’s sold more than $275-million of Zoom stock this year and is still worth about $21-billion, according to the Bloomberg Billionaires Index. Peloton founder John Foley became a billionaire on the stunning rise in the home-fitness company’s shares. He’s down more than $200-million after the stock tumbled as much as 25%.
Declines
FedEx chairman Fred Smith’s net worth dropped by $300-million as shares of the express shipping company fell about 6%. His fortune has surged this year by more than 70% through to last Friday as remote working and booming e-commerce boosted demand for package delivery services. Reed Hastings, CEO of movie and television streaming service Netflix, saw his net worth decline by $700-million.
Jay Chaudhry, CEO of cybersecurity firm Zscaler, Ocado co-founder Tim Steiner and Forrest Li — the billionaire behind Sea, Southeast Asia’s largest Internet company — also slumped in the fallout of Pfizer’s vaccine study. — Reported by Ben Stupples and Devon Pendleton, (c) 2020 Bloomberg LP
