7 Stay-at-Home Stocks to Buy Amid Second Wave Fears

Apprehensions regarding a second wave of coronavirus with no vaccine yet in sight are likely to compel people across the world to stay at home until and unless it is absolutely necessary to do otherwise. People are expected to follow social distancing norms, wear masks and limit travel for the foreseeable future.

Notably, over the July fourth weekend, the United States registered a whopping 156,000 new coronavirus cases. New coronavirus cases are up 42% in Florida, followed by 40% in Montana, 37% in Virgin Islands, 33% in Idaho, 32% in Arizona, 30% in South Carolina, 29% in Texas and 21% in California during the same period, per the Washington Post. The paper added that the seven-day average of new coronavirus cases was 48,361, up from 11,740 a week ago.
 
Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, said that the early reopening of many states, failure to maintain proper social-distancing norms and the authorities’ lack of effort to trace infected people are mostly responsible for this unprecedented surge in coronavirus cases, which many fear to be the second wave.

With the rising number of cases, governments globally are reassessing their moves of reopening and instead considering lockdown extension to contain the virus. Thereby, the pandemic spurred stay-at-home wave is here to stay.

This trend has led to growth in adoption of services related to e-commerce, gaming, leisure, interactive fitness, cooking-at-home, to name a few.

Here we discuss seven top-ranked stocks that are facilitating stay-at-home and making it easier for citizens to adapt to the new normal. Let us take a look.

Year-to-Date Price Performance

Notably, each of the stocks has outperformed the S&P 500 index on a year-to-date basis, as the chart below shows.

United Natural Foods UNFI is well poised to gain from cook-at-home wave, which has been an incredibly positive by-product of stay-at-home trend. The company has been gaining traction from burgeoning demand, stemming from the coronavirus-led panic buying of essential items.

Notably, stay at home has become the primary method of flattening the curve in these uncertain times. Amid this unprecedented crisis, people took up cooking and baking as a form of recreation to amuse themselves and their family. This also helped in de-stressing amid the pandemic woes.

These factors are expected to boost demand for United Natural Foods’ natural, fresh and conventional products, which instills optimism in this Zacks Rank #1 (Strong Buy) stock. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for current-year earnings has been revised upward by 103.4% over the past 60 days to $2.40 per share.

Leading developer and publisher of console, online and mobile games, Activision Blizzard ATVI is well poised to gain from strong popularity of its franchises, which is expected to boost in-game spending. This, in turn, is anticipated to drive net bookings and the top line in the near term.

Solid demand for gaming amid coronavirus-led lockdowns and enforcement of shelter-at-home guidelines are key catalysts.

This Zacks Rank #1 company reported that nearly 50 million people played the Call of Duty: Modern Warfare game in the first quarter, while Overwatch — a team-based multiplayer first-person shooter developed by Blizzard Entertainment — was accessed by 50 million.

The Zacks Consensus Estimate for 2020 earnings has moved north by 11.7% over the past 60 days to $2.77 per share.

Wayfair W is witnessing strong acceleration in new and repeat customer orders. Also, an expanding active customer base and strength in the company’s direct retail business are headwinds.

Stay-at-home wave is encouraging spend on upgradation of living spaces. This holds promise for this Zacks Rank #1 company, which engages in the e-commerce business, offering furniture, décor, decorative accents, housewares, seasonal décor, and other home goods.

The Zacks Consensus Estimate for its 2020 bottom line is pegged at a loss of $4.23 per share, having narrowed from a loss of $8.61 in the past 60 days.

While cook-at-home wave is here to stay, one cannot deny the food craving pangs to beat stay-at-home woes. In fact, with people staying at home, household chores have also increased, making them resort to ready-to-eat food safely delivered at doorstep. Domino’s Pizza DPZ is well poised to capitalize on it, backed by strength in its contactless carryout technology, which has now been expanded across all U.S. stores.

The company has adjusted its standard operating procedures keeping with the new normal. Unlike most other restaurateurs, Domino’s, its supply chain centers, corporate stores and franchisees plan to add 10,000+ employees across the United States.

The Zacks Consensus Estimate for current-year earnings has improved 3.6% over the past 60 days to $11.63 per share. Dominos currently has a Zacks Rank #2 (Buy).

Amazon AMZN dominates cloud computing and retail space, which poises it well to capitalize on high demand for cloud computing services and the ongoing e-commerce momentum spurred by the stay-at-home wave.

Strong adoption rate of Amazon Web Services (AWS) is aiding its cloud dominance. Moreover, AWS is gaining solid traction among healthcare workers, medical researchers, educational institutions and government organizations owing to coronavirus management measures. Further, the company is helping customers in staying safe at home with Prime courtesy of fast delivery services and strong content portfolio.

Also, expanding distribution strength and workforce, which are helping in addressing the overflowing online orders amid this pandemic, are major positives. Furthermore, robust Alexa skills and strong smart home product offerings are tailwinds for this Zacks Rank #2 company.

The Zacks Consensus Estimate for its 2020 earnings is pegged at $19.99 per share, having been revised upward by 1.7% in the past 60 days.

Being a leading provider of interactive fitness products in North America, Peloton Interactive PTON, currently carrying a Zacks Rank #2, saw its connected fitness subscribers soar 94% year over year to more than 886,100 in the fiscal third quarter ending Mar 31, 2020.

The company’s in-house exercise equipment like treadmills and stationary bikes, are expected to be in demand among fitness enthusiasts.

The Zacks Consensus Estimate for fiscal 2020 bottom line is pegged at a loss of 55 cents per share, having narrowed from a loss of 94 cents in the past 60 days.

Millennials are seeking to beat the stay-at-home heat, with increasing usage of Snap’s SNAP Snapchat. Strong adoption of Augmented Reality Lenses, Discover content and Shows is driving user growth. Notably, this Zacks #2 Ranked company’s growing popularity is expanding its advertiser base, thereby strengthening its competitive position.

The Zacks Consensus Estimate for 2020 is pegged at a loss of 22 cents per share, having narrowed from a loss of 23 cents in the past 60 days.

The Hottest Tech Mega-Trend of All

Last year, it generated $24 billion in global revenues. By 2020, it’s predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce “the world’s first trillionaires,” but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks’ 3 Best Stocks to Play This Trend >>

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