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10 Best COVID Stocks To Buy Now

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·9 min read
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In this article, we discuss the 10 Best COVID Stocks To Buy Now. You can skip our detailed analysis of these Covid stocks and go directly to read the 5 Best COVID Stocks To Buy Now.

Covid-19 crushed almost every sector, resulting in the world economy shrinking by 3.2% in 2020. In the initial stages of the pandemic, its long-term detrimental effects were uncertain, leaving everyone unprepared. With travel restrictions and lockdowns, many sectors suffered heavy losses and are still struggling to recover from the ills of the pandemic.

According to a report by World Travel & Tourism Council, in 2020, travel and tourism accounted for 5.5% of the global GDP, down from 10.4% in 2019.

However, to say that the market suffered a complete blowout would be an overstatement, as there were sectors that thrived during the pandemic. Technology remained the winner, exhibiting its ability to adapt to the new normal. According to a report by Morningstar, 45% of the workers reported that they worked from home in 2020, compared with 9% in 2019. Big tech companies like Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN) gained over 30% in 2020, as mentioned by Wall Street Journal. Similarly, the pharmaceutical industry also gained during the pandemic owing to its position in the crisis. The vaccine market worth $35 billion remained the key player in the pharma sector.

According to a paper published by Brookings Institution, the national GDP returned to its pre-pandemic level in the second quarter of 2021, growing at 6%, compared to 4.8% in the third quarter of 2020. However, the concerns surrounding another lockdown due to delta variant are still hovering over the investors, who look for safe options in case of another disruption. In this list, we mention some of the companies that performed well during the pandemic in 2020 and still have prospects to grow. Some of the most notable Covid stocks include Netflix, Inc. (NASDAQ:NFLX), Johnson & Johnson (NYSE:JNJ), Adobe Inc. (NASDAQ:ADBE), and Pfizer Inc. (NYSE:PFE).

Photo by National Cancer Institute on Unsplash

Our Methodology:

Let’s analyze our list of the best Covid stocks to buy now. We took into account hedge fund sentiment, analysts’ ratings, long-term growth potential, and fundamentals while choosing these stocks.

Why pay attention to hedge fund sentiment while choosing stocks?

Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021, our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the S&P 500 ETF (SPY). Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

Best COVID Stocks To Buy Now

10. Fiverr International Ltd. (NYSE:FVRR)

Number of Hegde Fund Holders: 30

Fiverr International Ltd. (NYSE:FVRR) ranks tenth on our list of the best Covid stocks to buy now. As the pandemic opened doors to freelance work, 45% of the businesses are using more freelancer talent than before the crisis. This resulted in the share price of Fiverr International Ltd. (NYSE:FVRR) jumping from $22.94 per share in April 2020 to $211.56 per share in December 2020.

In Q2 2020, Fiverr International Ltd. (NYSE:FVRR) reported a 43% year-over-year increase in active buyers at 4 million. The company posted an EPS of $0.19, beating the estimates by $0.05. Recently, the Royal Bank of Canada set a Sector Perform rating on Fiverr International Ltd. (NYSE:FVRR) with a $195 price target.

As of Q2, 30 hedge funds tracked by Insider Monkey reported having stakes in Fiverr International Ltd. (NYSE:FVRR), up from 27 in the previous quarter. The total worth of these stakes is $465.6 million.

Baron Funds mentioned Fiverr International Ltd. (NYSE:FVRR) in its Q1 2021 investor letter. Here is what the firm has to say:

“We sold out of Fiverr International Ltd., the marketplace for freelance services, since the stock ran up multiple fold since our purchase less than a year ago and traded at a valuation that we thought captured much of the future opportunity.”

9. Moderna, Inc. (NASDAQ:MRNA)

Number of Hedge Fund Holders: 37

Moderna, Inc. (NASDAQ:MRNA) was one of the very first companies to develop a Covid-19 vaccine and enrolled over 30,000 participants in its Phase 3 study of the vaccine candidate. Moderna, Inc. (NASDAQ:MRNA), an American biotech company, gained 379.3% in the past year. The company is expected to gain much due to the rollout of the Covid booster shots, which makes it one of the best Covid stocks to buy now.

Coatue Management is the leading shareholder of Moderna, Inc. (NASDAQ:MRNA) in Q2, with shares worth $1.4 billion. Overall, 37 hedge funds in the Insider Monkey database reported owning stakes in the company, compared with 39 in the previous quarter. The total worth of these stakes is over $5.75 billion.

In October, Piper Sandler upgraded Moderna, Inc. (NASDAQ:MRNA) to Overweight, with a $445 price target.

Carillon Tower Advisers mentioned Pfizer Inc. (NYSE:PFE) in its Q2 2021 investor letter. Here is what the firm has to say:

Moderna is a biotechnology company pioneering messenger RNA (mRNA) therapeutics and vaccines. The stock outperformed in the quarter, as the firm’s COVID-19 vaccine has shown effectiveness against the emerging variants of the disease, specifically the now prevalent Delta variant. The potential need for additional booster shots of the vaccine to maintain longer-term immunity as well as protection against possible future variants is also contributing to the stock’s move higher.”

8. Penn National Gaming, Inc. (NASDAQ:PENN)

Number of Hedge Fund Holders: 40

As sports betting generated over $1.5 billion in 2020, up 69% from 2019, Penn National Gaming, Inc. (NASDAQ:PENN) gained attention among investors. This American casino company has also expanded its online sports betting segment and expects to generate steady income from this. Penn National Gaming, Inc. (NASDAQ:PENN) stands eighth on our list of the best Covid stocks to buy now.

According to a research report, the global sports betting industry is expected to reach $173.9 billion by 2028, which presents tremendous growth opportunities for Penn National Gaming, Inc. (NASDAQ:PENN). Recently, Morgan Stanley resumed its coverage on Penn National Gaming, Inc. (NASDAQ:PENN) with an Equal Weight rating and an $85 price target. The firm’s analyst, Thomas Allen noted the company’s 10% market share in the U.S. and Canada iGaming and sports betting segment.

Of the 873 hedge funds tracked by Insider Monkey, 40 hedge funds had stakes in Penn National Gaming, Inc. (NASDAQ:PENN) in Q2, down from 42 in the previous quarter. The total worth of these stakes is over $1 billion.

Carillon Tower Advisers mentioned Penn National Gaming, Inc. (NASDAQ:PENN) in its Q2 2021 investor letter. Here is what the firm has to say:

Penn National Gaming is a diversified omnichannel provider of retail and online gaming, live racing, and sports betting entertainment. After a substantial run, Penn National Gaming sold off during the quarter, reflecting a profit taking in a number of sports and online gambling stocks. However, fundamentals are healthy in firm’s regional gaming markets and its sports betting initiatives remain strong.”

7. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN)

Number of Hedge Fund Holders: 48

Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) presented a positive hedge fund sentiment in Q2, as 48 hedge funds tracked by Insider Monkey reported owning stakes in the company, up from 39 in the previous quarter. The total value of these stakes is over $1.5 billion. Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN), one of the best Covid stocks, gained 34.1% in 2021.

Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN), a biotech company, reported its Q3 results on November 4. The company posted an EPS of $15.37, beating the estimates by $5.43. Its respiratory drug, Dupixent, was a widely used during the pandemic, generating $1.5 billion in revenue in the first quarter of 2021. Recently, Piper Sandler lifted its price target on Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) to $690, with an Overweight rating on the shares. The firm's analyst noted the importance of Dupixent in the post-Covid era.

6. Bath & Body Works, Inc. (NYSE:BBWI)

Number of Hedge Fund Holders: 53

Jim Cramer called Bath & Body Works, Inc. (NYSE:BBWI) a Covid-proof stock as the company witnessed tremendous growth due to the sanitizers and soaps sales during the pandemic. The sales are expected to surge due to the concerns surrounding the delta variant, making Bath & Body Works, Inc. (NYSE:BBWI) one of the best Covid stocks to buy now.

As of Q2, 53 hedge funds tracked by Insider Monkey reported owning stakes in Bath & Body Works, Inc. (NYSE:BBWI), compared with 59 in the previous quarter. The total worth of these stakes is over $6.3 billion. Lone Pine Capital is the company’s leading shareholder, with shares worth $1.89 billion.

Recently, BofA named Bath & Body Works, Inc. (NYSE:BBWI) as a well-positioned company to benefit from the upcoming holiday season as the company has shown consistent growth over the years. Since the beginning of the year, Bath & Body Works, Inc. (NYSE:BBWI) delivered a 115.7% return to shareholders, while its 12-month returns stood at 152.01%.

Bath & Body Works, Inc. (NYSE:BBWI) is also one of the notable stocks like Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX), Johnson & Johnson (NYSE:JNJ) , Adobe Inc. (NASDAQ:ADBE), and Pfizer Inc. (NYSE:PFE).

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Disclosure. None. 10 Best COVID Stocks To Buy Now is originally published on Insider Monkey.