The COVID-19 pandemic has transformed our lifestyle beyond imagination. With governments worldwide increasingly resorting to lockdowns to contain the virus, the pandemic spurred work-from-home and stay-at-home trends.
Thanks to digital transformation across industries and innovations in cloud computing, economies are surviving the ordeal on the back of growing clout of services related to video conferencing, gaming, cybersecurity, computer peripheral, online learning, leisure, interactive fitness, to name a few.
These sectors, which are thriving despite the tough scenario, hold potential to defy the recessionary woes and minimize the anticipated contraction of the world economy due to coronavirus-induced crisis.
Moreover, as we adapt to the new normal, economies are slowly starting to re-open as lockdowns gradually give way to unlock phases.
Nevertheless, the fear of a second wave and no vaccine yet in sight are likely to compel the world to stay-at-home unless there is any urgency to do otherwise. People are expected to follow social distancing norms and wear masks and limit travel for quite some time now. Work-from-home trends are here to stay.
Here are seven top-ranked stocks that are flourishing amid the coronavirus crisis. Let us take a look. Notably, each of the stocks has outperformed the S&P 500 index on a year-to-date basis.
Year-to-Date Price Performance
Videoconferencing titan, Zoom Video Communications ZM continues to add record number of subscribers and expand enterprise customer base amid the coronavirus-induced remote-working and online-learning wave. Easy to deploy, use, manage and solid scalability make Zoom Video’s software popular among customers.
As of Apr 30, 2020, Zoom Video, currently flaunting a Zacks Rank #1 (Strong Buy), had roughly 265.4K customers (with more than 10 employees), up 354% year over year. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for fiscal 2021 earnings has been revised upward by almost 181% over the past 60 days to $1.18 per share.
As education institutes shift focus to online learning, Chegg CHGG is expected to benefit from adoption of Chegg Services that allow students to find human help on its learning platform through a network of live tutors.
Strength in digital products and services such as Chegg Study, Chegg Writing and Chegg Tutors, hold promise.
The Zacks Consensus Estimate for current-year earnings has improved 15.2% over the past 60 days to $1.21 per share. Chegg currently sports a Zacks Rank #1.
Leading developer and publisher of console, online and mobile games, Activision Blizzard ATVI is well poised to gain from strong popularity of its franchises, which is expected to boost in-game spending. This, in turn, is anticipated to drive net bookings and the top line in the near term.
Solid demand for gaming amid coronavirus-led lockdowns and enforcement of shelter-at-home guidelines are key catalysts.
This Zacks Rank #1 company reported that nearly 50 million people played the Call of Duty: Modern Warfare game in the first quarter, while Overwatch — a team-based multiplayer first-person shooter developed by Blizzard Entertainment — was accessed by 50 million.
The Zacks Consensus Estimate for 2020 earnings has moved 11.7% north over the past 60 days to $2.77 per share.
Fortinet FTNT is positioned well to capitalize on the rising demand for security and networking products amid coronavirus crisis as a huge global workforce is working remotely. It is also benefiting from robust growth in Fortinet Security Fabric, cloud and SD-WAN offerings.
Moreover, continued deal wins, especially those of high value, and higher IT spending on cybersecurity, are key growth drivers.
The Zacks Consensus Estimate for 2020 earnings has been revised upward by 8.1% to $2.81 per share in the past 60 days. The company currently sports a Zacks Rank #1.
Logitech LOGI is gaining from solid performance of Gaming and Video Collaboration units amid stay-at-home orders due to the coronavirus outbreak.
Rising adoption of new mobile platforms in both mature and emerging markets is fueling demand for Logitech’s peripherals and accessories.
The Zacks Consensus Estimate for fiscal 2021 earnings, has been revised upward by 3.7% to $2.26 per share in the past 60 days. Also, Logitech currently flaunts a Zacks Rank #1.
It is impossible to overlook streaming giant, Netflix NFLX, which has been expanding its subscriber base on the back of content strength, focus on originals across various genres and languages, rapid international expansion, and partnerships with telcos.
With more people staying at home and cancelling travel plans, streaming Netflix is the go-to-option for in-house entertainment.
The Zacks Consensus Estimate for its current-year earnings has moved 6.3% north over the past 60 days to $6.40 per share. Netflix currently has a Zacks Rank #2 (Buy).
Last but not the least, online fitness programs amid restrictions to hit the gym has heightened demand for in-home exercise equipment among fitness enthusiasts.
Being a leading provider of interactive fitness products in North America, Peloton Interactive PTON, currently carrying a Zacks Rank #2, saw its ending connected fitness subscribers surge 94% year over year to more than 886,100 in the fiscal third quarter ending Mar 31, 2020.
The Zacks Consensus Estimate for fiscal 2020 bottom line is pegged at a loss of 54 cents per share, having narrowed from a loss of 94 cents in the past 60 days.
Zacks’ Single Best Pick to Double
From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This young company’s gigantic growth was hidden by low-volume trading, then cut short by the coronavirus. But its digital products stand out in a region where the internet economy has tripled since 2015 and looks to triple again by 2025.
Its stock price is already starting to resume its upward arc. The sky’s the limit! And the earlier you get in, the greater your potential gain.
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