As coronavirus fears inflict havoc on Wall Street, a few stocks are thriving on expectations that millions of people will spend weeks or longer cooped up at home.
Meal-kit delivery company Blue Apron Holdings has been a major gainer from social distancing to avoid COVID-19, surging over 300 per cent in the past five days, even after a 29 per cent drop on Friday. Prior to its recent surge, it had fallen nearly 70 per cent in 2020 due to growing competition and disappointing revenue.
Zoom Video Communications has jumped 24 per cent this month as employees working from home hold meetings on the company’s video conferencing app.
Domino’s Pizza has slipped almost 11 per cent in March, faring better than the broader market’s 22 per cent slump in that time. This week it said that franchise-owned locations in Chicago were trying to hire 1,000 people to meet a jump in demand.
Just five companies in the S&P 500 remain in positive territory following the benchmark’s tumble from its record on Feb. 19 which ended an 11-year bull market. Gilead Sciences and Regeneron Pharmaceuticals are each up 9 per cent during that time, as both biotechnology firms race to develop coronavirus treatments.
Cleaning products maker Clorox and supermarket operator Kroger Co have also added 8 per cent since Feb. 19 as worried shoppers stock up on rice, toilet paper and other goods.
In a sign of what may follow across the United States, New York and California imposed tough new measures, limiting the activity of 60 million people in the two states to curb the spread of coronavirus and ordering all non-essential workers to stay at home.
Video-game makers Electronic Arts and Activision Blizzard in March have lost 14 per cent and 10 per cent, respectively, but they stand to benefit from a sales jump as closed schools keep students at home. Microsoft Corp’s Xbox and Sony’s Playstation online services have both had interruptions in recent days that left customers unable to play their games.
“Not only are all of the middle school and high school gamers staying home but now all of the millennials are so-called ’working’ but probably mostly gaming from home,” said Jake Dollarhide, chief executive of Longbow Asset Management in Tulsa, Oklahoma, pointing to Activision Blizzard as one of his top picks.
Tim Ghriskey, chief investment strategist of Inverness Counsel in New York, said Amazon.com Inc was his favorite “stay at home” stock, benefiting from a surge in grocery deliveries and more people watching its Prime Video streaming service.
With fitness clubs closed during the health crisis, Peloton Interactive, which sells stationary bikes and streams fitness classes online, has become a hot topic across the internet. Google searches for “Peloton” have nearly tripled since the end of February, according to Google Trends. Peloton’s stock has gained almost 17 per cent in the past week.
Bespoke Investment Group in a report on Thursday pointed to internet infrastructure Akamai Technologies, Home Depot Inc and golf club seller Callaway Golf as companies likely to benefit as people keep their physical distance.
“If there’s one sport that you can still play while practicing social distancing, it’s golf,” Pivotal wrote. "Golf courses should be able to remain open in a COVID world, and a stock like Callaway Golf could be selling a lot more clubs and balls as the weather heats up and checks start showing up in the mail.”
Walmart Inc and Amazon this week announced plans to hire a combined 250,000 workers due to a jump in business related to the outbreak.