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6 Stocks to Benefit From the 'New Normal'

The coronavirus pandemic is wrecking havoc for months now. With businesses closed across the globe, the magnitude of the damage is unprecedented. Moreover, there has been a massive impact on the supply chain across the globe.

The pandemic-led lockdowns have forced people to stay and work from home. This in turn has given rise to new trends like remote working, accelerating technological development. In fact, businesses now need to relook at staff compensation, with majority offering productivity from home. In several countries, governments are also making changes in policies to help both employees and employers to get through such trying times.

The ‘new normal’ has altered several businesses, and here are a few emerging trends we would like to discuss–

Dine-at-Home is the New Dine-Out

With coronavirus being highly communicable, social-distancing guidelines have been introduced, leading to closure of restaurants and dine-out facilities.

Many restaurants have not been generating any revenue for months now and have been exploring alternate option sowing to slim chances of the virus dissipating anytime soon. Several chef-driven, fine dining restaurants, which earlier solely focused on providing customers a dining-in experience, are now planning to offer take-away and delivery services.

Similarly, many companies that provide ready-to-cook meals are now collaborating with renowned chefs and restaurants to deliver recipes and ingredients to customers’ doorstep. All in all, food delivery enterprises seem to be in a better position as dinning-in is the only option now. Here are two stocks that can make the most of this new normal –

Blue Apron Holdings, Inc. APRN operates a direct-to-consumer platform that delivers original recipes, and fresh and seasonal ingredients. The company’s expected earnings growth rate for the current quarter is 23.7% against the Zacks Food - Miscellaneous industry’s projected earnings decline of 1.7%.

The Zacks Consensus Estimate for its current-year earnings has moved up9.7% over the past 60 days.Blue Apron carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Domino's Pizza, Inc. DPZ operates as a pizza delivery company. The company’s expected earnings growth rate for the current year is 14.2% against the Zacks Retail - Restaurants industry’s projected earnings decline of 28.1%. The Zacks Consensus Estimate for its current-year earnings has climbed1.9% over the past 60 days.Domino's Pizza carries a Zacks Rank #2.

Physical to Digital Transition

The COVID-19 crisis has resulted in the extensive use of robots and AI. From delivery, healthcare to surveillance, robots and AI are now replacing people at warehouses, factories, stores and even for police patrol.

In fact, since the outbreak, there has been a significant rise in online grocery orders, for both convenience and safety. Even for businesses, all processes, starting from order processing to internal communication, and from supply chain management to client service, have being digitized.

The crisis has led to rapid acceleration in development of technologies in various spheres of businesses. In fact, some changes that would have taken several years in a normal scenario, have been implemented in just months. Here are two robotics companies that will enjoy a boom –

Accuray Incorporated ARAY designs, develops and sells radiosurgery and radiation therapy systems. The company’s expected earnings growth rate for the current quarter is more than 100% against the Zacks Medical - Instruments industry’s projected earnings decline of 21.6%. The Zacks Consensus Estimate for its current-year earnings has moved100% up over the past 90 days. Accuray carries a Zacks Rank #2.

AeroVironment, Inc. AVAV offers unmanned aircraft systems. This Zacks Rank #3 (Hold) company’s expected earnings growth rate for the current year is 1.7% against the Zacks Aerospace - Defense Equipment industry’s projected earnings decline of 12%. The Zacks Consensus Estimate for its current-year earnings has advanced8.6% over the past 90 days.

Cloud Computing Powering Remote Working

With millions under lockdown, cloud computing and storage seem to be part of every person’s life. From video conferencing, gaming, shopping, remote project collaboration to online classes, everything is online these days.

Along with connecting employees who are working remotely, cloud computing offers storage, data backup, disaster recovery and archiving facilities. In fact, the cloud computing boom has pushed companies like Microsoft Corporation MSFT to venture into different regions across the world, building its first datacenters in Italy, Poland and New Zealand.

Meanwhile, Tencent and Alibaba are offering a vast array of cloud computing services for free to researchers and scientists, designed to support research that includes diagnosis, testing and genome sequencing of COVID-19. These cloud computing tools are also designed to help businesses, medical institutions and governments fight the pandemic. Here are two cloud-computing stocks that are poised to grow with the new trend –

CrowdStrike Holdings, Inc.’s CRWD Falcon is a cloud-native endpoint security platform that protects customers against all cyber-threats with the power of big data and AI. The company’s expected earnings growth rate for the current quarter is 87.2% against the Zacks Internet - Software industry’s projected earnings decline of more than 100%. The Zacks Consensus Estimate for its current-year earnings has moved36.8% north over the past 60 days. CrowdStrike carries a Zacks Rank #2.

Microsoft’s Azure offers cloud computing services for building, testing, deploying, and managing applications and services through data centers. Azure sales grew 59% in third-quarter fiscal 2020, while sales of Office 365 Commercial and Dynamic 365 climbed 25% and 47%, respectively. The company’s expected earnings growth rate for the current year is 19.7% against the Zacks Computer - Software industry’s projected earnings decline of 9%. The Zacks Consensus Estimate for its current-year earnings has climbed1.3% over the past 60 days. Microsoft carries a Zacks Rank #3.

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Microsoft Corporation (MSFT): Free Stock Analysis Report
 
Dominos Pizza Inc (DPZ): Free Stock Analysis Report
 
Accuray Incorporated (ARAY): Free Stock Analysis Report
 
AeroVironment, Inc. (AVAV): Free Stock Analysis Report
 
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CrowdStrike Holdings Inc. (CRWD): Free Stock Analysis Report
 
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