Zoom, Slack, Docusign: Will Flu Season Help Work From Home Stocks?
The Coronavirus has forced people to increasingly work and learn from home, causing surging demand for connectivity, collaboration, and cybersecurity-related software. Our indicative theme on Work And Learn From Home Stocks is up by 210% year-to-date, compared to the S&P 500 which is up a mere 4%. Most of these stocks have fared well over the last few weeks as well, as investors bet that the fall flu season could see Covid-19 cases rise in the U.S., calling for greater restrictions and stay-home orders.
To be sure, valuations are high for many of these stocks, but it’s quite possible that the pandemic will result in a structural shift of sorts, benefiting these companies in the long-run as well. Zoom (NASDAQ: ZM) has been the biggest driver of the theme’s returns, rising by over 580% year-to-date. On the other side, Slack’s (NYSE: WORK) performance has been more muted, rising 20% this year. Below is a bit more about the companies in our theme.
Zoom (ZM) has emerged as the video conferencing platform of choice through the pandemic, thanks to its easy user interface and simple sign-up process. The stock has gained about 580% year-to-date and is up by about 4% over the last 5 trading days.
DocuSign (DOCU) offers e-signature solutions that enable companies to sign and manage contracts and agreements digitally, avoiding a time consuming and inefficient manual process. The stock has gained 187% year-to-date and is up by about 4% over the last 5 trading days.
CrowdStrike (CRWD) is a cybersecurity player that offers a cloud-delivered endpoint protection platform, which relies on a lightweight software running on the customer’s servers or laptops. The stock is up by 173% this year and is down by about -1% over the last 5 trading days.
Okta (OKTA) is a cloud security company that provides identity and access management tools that enable users to securely access cloud-based applications from various devices. The stock has gained about 85% this year and is up by about 3% over the last 5 trading days.
Slack Technologies (WORK) is best known for its collaboration platform that is positioned as an alternative to email. The stock is up by about 20% year-to-date and is up by about 2% over the last 5 trading days.
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio to beat the market, with over 100% return since 2016, versus 50% for the S&P 500. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.
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