Apr 13, 2020
As the novel coronavirus pandemic sweeps through the planet, every industry, business, and individual of the world got affected by the lethal virus. The first quarter of 2020 has seen an uproar in the financial markets across the world. But some stocks grew erratically, creating a time-tested opportunity for traders and investors.
Amongst the best stocks on the market are of course pharmaceutical companies like Nvidia and Vertex Pharmaceuticals, but also a surprising random group like Amazon, Netflix and Domino’s Pizza.
Amazon’s stock has proven to be pandemic-free. While most companies across the world are facing a staggering decline in profits, Amazon is expanding. Wall Street analysts are extra bullish on Amazon stock, as the online retailer benefits from online shoppers as well as its cloud services division.
Last week, Amazon closer at $2,042 which has been a gain of 27% and the stock’s year to date growth has been 9%. People are buying groceries and essential household items from Amazon.com to avoid stepping outside. Furthermore, the company is expanding and hiring over 100,000 people across the USA to meet the demands of its aggressively growing business.
Entertainment companies’ entertainment companies like Netflix have seen a growth in their profits. The demand for streaming platforms has grown as people are isolated at home.
Netflix’s stock gained 16%, making it a winner amongst the other technological companies. Since the commencement of the pandemic, the stock has seen a bullish upward trend. The streaming platform’s surge has caused a strain on internet providers in Europe, confirming its popularity. This has led Netflix to announce plans for reducing its bandwidth consumption to aid the European telecommunications networks.
2020 plans to be a successful year for Netflix, “We view Netflix as one of the preeminent stay-at-home winners, with the current environment enabling it to widen its global lead,” said Baird analyst, William Power to his clients.
Domino’s Pizza (DPZ)
Domino’s Pizza is another business that witnessed growth in 2020. Amidst the pandemic, restaurants were forced to close their doors or turn to delivery; delivery is Domino’s area of expertise. Domino’s was able to capitalize on this and had to hire additional staff to meet the new demand.
The pizza chain has continued to lead amongst its competition and took leadership in market share for the 10th consecutive year. CFO Jeffrey Lawrence said, “Our continued sales growth and improved discipline around our general and administrative investments led to a healthy growth in our diluted EPS year over year and strong and consistent free cash flow generation.”
Domino’s management plans to continue building its empire; they plan to open more stores and invest in their business technology to improve their customer support.
What about the big Pharma?
As global markets crashed, investors started seeking other opportunity stocks. The logical option would look at pharmaceutical stocks, and that would make sense. Amongst those is Gilead Sciences (GILD), whose antiviral drug, Remdesivir, was declared most promising potential medicine for the fight against the disease. Gilead plans to launch its clinical trials in China very soon. The company’s shares are up by 12%.
Another company whose shares bounced in recent months has been Regeneron Pharmaceuticals (REGN), who recently announced that its rheumatoid arthritis drug, Kevzara, could be used treat COVID-19 patients, “Regeneron is applying our 30 years of scientific and technology expertise to combat the COVID-19 pandemic. We feel uniquely positioned to meet this public health threat using our proprietary VelociSuite® technologies and our track record for rapid response against infectious diseases, such as Ebola,” the company published on its website, “Based on recent clinical data from studies in China with another IL-6 inhibitor, we believe there is a potential role for Kevzara® (sarilumab) in the treatment of severe and critical hospitalized patients with COVID-19.”
The infamous Johnson & Johnson (JNJ) is also amongst the frontlines of the battle against the novel virus. Johnson & Johnson plans to start clinical trials of its new vaccine by September 2020. The stocks of J&J are up over 5% and continue growing.
The battle continues…
As the pandemic continues to shut down economies around the world and Biotech companies are at war to win the battle against the virus, other treatments have geared interest in the public, such as the medicine used to treat malaria, chloroquine, for example. Investors continue scanning for successful stocks to monetize on and as we saw from Netflix and Domino’s, those are not limited to the Big Pharma. A tip for all investors and traders: watch this space!