Panic, overinflated fear, and now false recoveries. Stimulus packages , RBA cuts , national lockdowns, empty supermarket shelves, rollercoaster activity on the stock market, and exponential escalations in the coronavirus death toll.
After reading that, your brain might feel like it is travelling at a million miles an hour. Many investors may find it challenging to make sense of the market as the media continues to inundate us with coronavirus updates every minute.
However, many investors are simplifying the chaos in the market through coronavirus strategies.
The coronavirus investment strategies YIG has covered include:
- Inverse Exchange Traded Funds (ETF)
- Investing in momentum-driven, undervalued micro-caps
- Investing in Gold
- Snapping up quality blue-chip stocks for a fraction of the price (US version)
- Riding the waves of trending stocks throughout the virus (Hand sanitiser, toilet paper stocks or COVID-19 Vaccine companies)
Today we are discussing the investment potential behind coronavirus stocks Slack Technologies (NYSE: WORK), Zoom Video Communications (NASDAQ: ZM), and QIAGEN (NYSE: QGEN).
Slack Technologies (NYSE: WORK)
Slack Technologies is a free online platform that allows users to send messages, images, and documents to other users without needing their email. Slack is on the watchlist for many investors after surging 67% in two weeks.
Global lockdowns are causing universities and businesses to use online channels in an attempt to replicate a learning and working environment.
So how exactly do you manage an all-hands or conference digitally? Or even a team meeting for that matter? Well, here's how we do it: https://t.co/ntsd7ox3U7
— Slack (@SlackHQ) March 24, 2020
The rapid surge in online conferences saw Slack report a record 12.5 million simultaneous users last Wednesday. Moreover, CEO Stewart Butterflied expects revenue for FY2021 to be up 38%. Thus, it is more so the expectation of future revenue growth that is driving up Slack’s share price.
However, investors are wondering whether the bullish trend can continue?
The likelihood of current lockdowns being extended and more being implemented is high. Meaning, we could see a tsunami of people flock towards platforms such as Slack. Thus, possibly triggering even more share price surges in the imminent future.
Moreover, Slack recently announced its plan to integrate its platform with rival Microsoft teams. Allowing people to call Microsoft team users directly without leaving the Slack platform.
The completion date is uncertain. However, once Slack launches the Microsoft-team feature, more investors are likely to rally behind the tech company. However, that is my opinion, and your own research is needed.
Zoom Video Communications (NASDAQ:ZM)
Zoom is a cloud-based platform that provides video, and audio conferencing, file sharing, and webinars across millions of devices. Much like Slack Technologies, Zoom is receiving unprecedented traction.
Zoom shares have increased by 107% since the start of the year. Like, Slack, the driving factor behind Zoom’s growth is the growing trend to hold virtual meetings during the coronavirus pandemic. In turn, Zoom saw its rating on the app store skyrocket from 87 to 11 in two weeks.
The recent surge in Zoom users saw the innovative tech company report total revenue of 622,658 for Q3. Which is a whopping 88% increase year on year.
Personally, I believe the Zoom share price is overvalued and is due for a small correction soon. Nonetheless, an upward direction is likely to occur if new lockdowns emerge or we see the existing ones be extended.
QIAGEN (NYSE: QGEN)
QIAGEN is a German molecular company that produces testing kits for the coronavirus. QIAGEN’s test kit is used to “differentiate the novel SARS-CoV-2 coronavirus from 21 other serious respiratory infections”. The company expects to receive advanced development support from the U.S Department of Health and Human Services’ Office of the Assistant Secretary for Preparedness and Response (ASPR) in the imminent future.
QIAGEN ramped up production to 24/7 to ensure its testing kits can be of great assistance in containing the outbreak. QIAGEN’s new production measures should result in a significant amount of testing kits being shipped to the US. However, only time will tell as QIAGEN only began shipping to the US last Thursday.
With COVID-19 cases and deaths rising exponentially, QIAGEN seems to hold colossal market potential.
However, just remember the growth behind these stocks is often short-lived. Because coronavirus predictions are changing by the minute. Meaning you could try and ride the wave, but if your timing is off, then the water could flip you off your board, resulting in a capital loss.
The YIG team is and will continue to provide you with some of the simplest yet effective coronavirus strategies out there. Stay tuned and subscribe for free if you want access to more strategies.
Here is our free, uncomplicated, and extensive ASX portfolio
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The information above should not be taken as financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
Written by Jaewon Jung, Associate at YIG.