With the insidious coronavirus beginning to spike once again, investors are starting to pull out their list of top coronavirus stocks to buy. While the clear winners from the pandemic would be Amazon (AMZN Stock Report) and Walmart (WMT Stock Report), there are many other stocks that could benefit if the virus continues to stick around. There’s no doubt the pandemic has wreaked havoc on the stock market in March this year. Last week, stocks tumbled as fears of another wave of coronavirus infections swept the U.S. stock market. Some were probably wondering if we were going to see losses as bad as those in March.
Over the weekend, the number of daily cases continues to rise to record highs in the U.S. and parts of Europe, prompting fears of another round of full national lockdown, squeezing the economic recovery. For investors, such an event is likely to push stocks lower since they are already trading near all-time highs. But there are a few companies that could be winners even if the U.S. is forced into another lockdown. With all that in mind, the recent rally of coronavirus stocks earlier this year could resume with or without lockdown measures globally.
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Zoom Video Communications (ZM Stock Report) was one of the first coronavirus stocks to take off at the onset of the pandemic. In fact, its rally started before the stock market crash in March. It’s the quintessential coronavirus stock. Shares have enjoyed years worth of gains in just a few quarters. That’s because the company has seen a few years’ worth of growth taking place in just a couple of months. ZM stock has enjoyed 570% gains year-to-date. Obviously, Zoom can’t continue this kind of rally every year.
In its second-quarter ended in July 2020, Zoom’s revenue shot up 355% year-over-year to $663.5 million. That exceeded analysts’ estimates of $500.5 million. The company ended Q2 2020 with over 370,000 customers, representing a significant growth of 458%. These numbers are staggering and are likely to fuel Zoom’s revenue for the years to come. Even with a vaccine around the corner, this new norm is likely to stay. Looking to fiscal Q3, management indicated that this strong momentum would continue. The company guided for third-quarter revenue of $685 million to $690 million, up from $167 million in the year-ago period.
During the company’s Zoomtopia event last month, Zoom announced several new features and products. By introducing immersive scenes, all meeting participants will be shown in a common background to give the impression of being in the same area. The key highlight however was on how the company is presenting itself as a platform rather than just a videoconferencing tool. Its new OnZoom online event platform will host events like webinars. The company also unveiled Zapps, which allows other productivity apps, such as Dropbox and Slack, to be used directly in Zoom. With that in mind, will ZM stocks continue to benefit during this uncertain time?
Shares of Teladoc (TDOC Stock Report) plunged nearly 10% during the last intraday trading. The company released its third-quarter earnings last week. The results weren’t exactly great. Part of it was because statutory losses grew 33% to $0.43 per share. The saving grace was that the company achieved a revenue of $289m, beating expectations by 2.4%.
The thing is, as the largest telemedicine company, Teladoc certainly has reasons to shine. It appears to have a tendency to surpass sales expectations. Full-year revenue could rise to $1 billion this year. Considering that 2013 revenue was about $20 million, the company has certainly come a long way. Revenue grew at an annualized rate of 75% during this period. The dominance of the telehealth platform became even more pronounced in August when it said it would acquire Livongo Health (LVGO Stock Report) for $18.5 billion in a cash and stock deal. The combined company could offer phenomenal growth potential in the long run, if analysts’ projections materialize a few years down the road.
In fact, telehealth was already gaining steam before the onset of the pandemic, but with the pandemic continuing to spread rapidly, patients are adopting this niche healthcare service like never before. A commanding lead in a rapidly growing niche makes TDOC stock one of the best coronavirus stocks to buy. The long term prospects of telemedicine remain favorable. With more users now discovering the advantages of remote medicine, TDOC stock might be able to continue to thrive even after the pandemic.
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Household name Clorox (CLX Stock Report) has certainly benefited from the pandemic hoarding. Many consumers rushed to stock up on its disinfecting wipes. After all, the public was cautious about contracting the virus and therefore wanted to be squeaky clean. The company is slated to report its third quarter-financial result on November 2.
The demand for the company’s product was overwhelming, to say the least. The demand was so huge that the backlog is until next year. The company has to expand its business to a third-party contractor network to fill up the gap from the massive surge in demand. Of course, no one knows how much further the pandemic will go on. And that means the demand for Clorox’s products may taper off soon. Even if the pandemic stays on, some consumers probably realized that they had already purchased too many cleaning products earlier this year. The company, of course, isn’t a one-trick pony as it owns some of the top-selling brands in the home care and personal care segments. 80% of the company’s revenue comes from market-leading brands like Pine-Sol, Formula 409, Burt’s Bees, and Clorox bleach.
Clorox is a stalwart among consumer goods companies. The stock remains a favorite among investors. That is not surprising, as the company has raised its dividend every year for over 5 decades. Not too shabby if you ask me. Of course, good things don’t come cheap. If you are looking for something to make your portfolio sparkle, could CLX stock fit the bill?
