U.S. markets closed
  • S&P 500

    3,666.72
    -2.29 (-0.06%)
     
  • Dow 30

    29,969.52
    +85.73 (+0.29%)
     
  • Nasdaq

    12,377.18
    +27.82 (+0.23%)
     
  • Russell 2000

    1,848.70
    +10.67 (+0.58%)
     
  • Crude Oil

    45.64
    +0.36 (+0.80%)
     
  • Gold

    1,844.80
    +3.70 (+0.20%)
     
  • Silver

    24.19
    +0.05 (+0.22%)
     
  • EUR/USD

    1.2148
    +0.0032 (+0.27%)
     
  • 10-Yr Bond

    0.9200
    -0.0280 (-2.95%)
     
  • GBP/USD

    1.3452
    +0.0076 (+0.57%)
     
  • USD/JPY

    103.8430
    -0.5810 (-0.56%)
     
  • BTC-USD

    19,440.95
    +492.05 (+2.60%)
     
  • CMC Crypto 200

    382.08
    +7.68 (+2.05%)
     
  • FTSE 100

    6,490.27
    +26.88 (+0.42%)
     
  • Nikkei 225

    26,809.37
    +8.39 (+0.03%)
     

5 Winning Stocks in Coronavirus-Led Stay-at-Home Economy

Sreoshi Bera
·6 min read

The coronavirus pandemic has infected millions of people worldwide, disrupted supply chains and weighed on the global economy. In order to curb the spread of the deadly coronavirus, governments across the globe have implemented stay-at-home orders. And lockdown measures have become a blessing in disguise for certain stocks. Let us have a look –

Grocery & Online Retailers Rally on Stockpiling

Surging stay-at-home mandates have pushed consumers to shop online for essential commodities to minimize human contact. Along with that many consumers are also availing facilities like curbside pickups from their nearest retail or wholesale stores. With uncertainties looming as to when the economy will be operating at its full potential and the virus will dissipate, people have been stockpiling bread, milk, meat and other household requirements like toilet paper. (Read More: Coronavirus-Induced Stockpiling Boosts These 5 Retailers)

This increase in demand has rewarded retailers and grocers higher sales, which will eventually translate into better-than-expected earnings. In fact, the stay-at-home mandates have given a boost to the consumer staples sector even during this economic downturn and have pushed people to spend more on grocery as dine out options remain closed.

Additionally, this increase in demand has forced companies like Amazon.com, Inc. AMZN and The Kroger Co. KR to hire new warehouse and delivery workers. Amazon has announced plans to hire 75,000 workers in addition to the recent hiring of 100,000 employees.

Remote Working Drives Cloud and Tech Stocks

Since the outbreak of COVID-19, many companies have been advising people to work from home. And given the current scenario, people have to maintain social distancing and work remotely.

This has given a boost to Internet providers, cloud computing and other technology facilitating in remote working. Cloud computing helps in connecting employees to the organization and remotely process information to develop and run key applications and service like they do in their workplace.

For instance, Amazon Web Services (AWS) offers computing power, database storage, content delivery, and other functionality to help businesses scale and grow. Google offers free video-conferencing through its Hangout Meet conferencing platform for larger meetings with up to 250 participants and live streaming for 100,000 viewers within a domain.

These technologies not only facilitate in remote working but also reduce the mental gap between employees and teleport them into a 3D space so they can feel that they are in the same room as others.

Socializing Apps Bridges Distancing Gap

Coronavirus-led lockdowns have enforced self-isolation and in turn provided a significant boost to socializing and entertainment needs, directly driving Internet traffic.

In fact, it has been noticed that people are using computersand laptops more than their smartphones to access social media, tweet, stream series and play games. As per SimilarWeb and Apptopia’s latest report, website versions of Facebook, Netflix and YouTube have witnessed growth in number of users, compared to their phone applications, which has seen marginal growth.

Along with the growth of traditional social media sites like Facebook, Instagram and Twitter, a few applications that were relatively unknown have taken center stage. For instance, people are using Houseparty, an application that allows friends and family groups to join a single video chat and play games together.

5 Winning Stocks

Given the current scenario of COVID-19, lockdown and social distancing norms may continue at least for the next few weeks. Hence, we have shortlisted five winning stocks that are poised to grow in spite of the slump in the global economy.

Dropbox, Inc. DBX is a collaboration platform that allows individuals, teams, and organizations to collaborate through its website or application. This Zacks Rank #1 (Strong Buy) company’s expected earnings growth rate for the current year is 40% compared with the Zacks Internet - Services industry’s projected earnings growth of 3.4%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 22.8% upward over the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.

Costco Wholesale Corporation COST operates membership warehouses. The company’s expected earnings growth rate for the current year is 7.2% against the Zacks Retail - Discount Stores industry’s projected earnings decline of 12.9%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 1.5% upward over the past 60 days. Costco carries a Zacks Rank #2 (Buy).

Chewy, Inc. CHWY provides pet food, pet products, pet medications, and other pet health products. The company’s expected earnings growth rate for the current year is 27.6% compared with the Zacks Consumer Products - Staples industry’s projected earnings growth of 6.2%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 17.8% upward over the past 60 days. Chewy has a Zacks Rank #2.

Netflix, Inc. NFLX is a provider of streaming services and DVD-rental services.The company’s expected earnings growth rate for the current year is 45.8% compared with the Zacks Broadcast Radio and Television industry’s projected earnings growth of 0.8%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 0.7% upward over the past 60 days. Netflix carries a Zacks Rank #2.

Nintendo Co., Ltd. NTDOY develops, manufactures and distributes electronic entertainment products. The company’s expected earnings growth rate for the current year is 18.1% against the Zacks Toys - Games - Hobbies industry’s projected earnings decline of 0.9%. The Zacks Consensus Estimate for the company’s current-year earnings has been revised 11.6% upward over the past 60 days. Nintendo has a Zacks Rank #2.

Today's Best Stocks from Zacks

Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2019, while the S&P 500 gained and impressive +53.6%, five of our strategies returned +65.8%, +97.1%, +118.0%, +175.7% and even +186.7%.

This outperformance has not just been a recent phenomenon. From 2000 – 2019, while the S&P averaged +6.0% per year, our top strategies averaged up to +54.7% per year.

See their latest picks free >>

Click to get this free report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Costco Wholesale Corporation (COST) : Free Stock Analysis Report Netflix, Inc. (NFLX) : Free Stock Analysis Report The Kroger Co. (KR) : Free Stock Analysis Report Nintendo Co. (NTDOY) : Free Stock Analysis Report Dropbox, Inc. (DBX) : Free Stock Analysis Report Chewy Inc. (CHWY) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research