Here are a few stock investments to look at during this time of crisis.
During the Corona virus pandemic, there will be a massive domino effect on our economy as we know it. You can already see the United States has cancelled or postponed Major Sporting events such as the NBA’s regular season, NCAA March Madness Tournament, NFL Drafting, NHL regular season, PGA Golf Openings etc. The Stock market has not responded well to these events. There’s a fine line between financial profit and severe losses.
As always with stock investing, consider supply and demand FIRST. Sickness and disease calls for immediate MEDICAL attention. Businesses within the Medical and Health field will be in the highest demand ever. Consider American Healthcare retailers such as CVS (CVS), Walgreens (WBA), Rite Aid (RAD) ETC. Also retailers, such as Walmart and Target are getting cleared out by consumers in preparation for self- quarantining. (All figures are as of Market close on 3/13/20), Walmart(WMT) sells for about $115 per share with a 2.08% dividend and Target (TGT)sells for about $100 per share with a 2.85 % dividend. You can also look for the products themselves which are selling off the shelf at a record rate such as Lysol and Clorox. Lysol is distributed by the Reckitt Benckiser Group (RBGLY)and sells for $13.94 per share with a 2.69% dividend and The Clorox Company (CLX) sells for about $170 per share with a dividend of 2.67%. Unfortunately, Purell is a privately owned company which means NO STOCKS. What’s amazing is, currently, all of the mentioned stocks come with a dividend which could progressively increase to retain investors during this time.
As social distancing continues, people will STILL need care products that those retailers provide such as food, sodas, toiletries,personal care products such as lotions, deodorants, soaps, disinfectants, etc . With shelves being completely emptied, Expect these companies to report major sale increases for the months of February, March, and maybe even April of 2020. Your job as an investor is to find out what quarterly reporting will reflect these current sales. For an example, Walmart is expected to report earnings on 5/19/20 for months February, March, and April 2020.
Contrarily, companies that are socially-based are suffering. On 3/12/20 Planet Fitness (PLNT) hit a 52-week low of $46.17(Almost a 50% Loss) from $88.57 on 2/19/20. Almost the same thing occurred with Uber(UBER) at $22.60 market close 3/13/20 after falling from $41.27 on 2/11/20 and Lyft (LYFT) is at $24.17 as of 3/13/20 falling from $53.94 the same day of 2/11/20. There could be some unique scenarios for their use such as Uber Eats and a Public Transportation Ban, but I’d observe until then. Companies such as these will only get worse when their impacted sales are revealed 6 months from now. Opportunities to invest may arrive later in 2020 once they further hit their lows and the smoke clears. Quarantine works directly against these companies’ business models. On the other hand, consider the services houses will be using while quarantined such as internet and Netflix (NFLX)!
Be wise and consider some of the cascading effects each event will have on certain industries. For example, retailers may be selling more products, but consider their sources. They may be paying a higher price for their items if it was produced in highly impacted areas such as Italy and China due to scarcity and high demand. Coca Cola (COKE) could be paying more for sugar produced in China. This could affect a company’s profitability. Do your research and examine trends of the market for weeks before you make a decision. There will be much more volatility to come. Maybe you could even get in at a lower price! Make sure you have a savings strategy and an exit strategy. RESERVE YOUR GOLD!
Don’t Know Where to Start? Here’s the simplest guide you’ll ever read on How To Buy Stocks!
(Disclaimer: I do NOT hold stake in any of the mentioned companies except 1 at the time of this post. This post is for informational purposes and the statement of facts such as prices only. All Stocks are associated with significant risk and losses are NOT insured. Buy at your own risk.)
