CNBC's Jim Cramer said Wednesday he sees more upside ahead for economic reopening play United Airlines, while expressing a cautious outlook on stay-at-home winner Zoom Video Communications.
“For now, I'd much rather bet on the going-out stocks. I think United's got a lot more room to run here, whereas Zoom's still at least one acquisition away from turning around,” the “Mad Money” host said. “Love the company, love the product, but the stock? Not yet.”
Shares of United and Zoom traveled different paths during the pandemic, with the former seeing its stock fall from $80 in February 2020 to around $20 at its Covid lows. Zoom, meanwhile, went from roughly $70 pre-Covid before closing at nearly $570 per share in October 2020, as its video-conferencing platform became a household name and revenue soared.
Now, United has more than doubled from its pandemic bottom, finishing Wednesday's session down 0.6% to $45.95, while Zoom has been more than cut in half from its highs. Zoom closed Wednesday at $275.71 per share.
Cramer said even at this point, he still thinks United is the better play for investors. He cited the return of international travel, in particular, as one tailwind for the airline. Even if business travel takes time to come back, Cramer suggested strong demand for leisure trips should be able to compensate for that.
“Long-term, both United and Zoom, of course, can coexist,” Cramer said. But in the near-term, Cramer said Zoom needs to broaden out its product offerings. “If it can come up with some new lines of business, maybe the tables will turn,” he said.
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