The coronavirus pandemic continues and may even get worse when the fall flu season arrives. What are some safe investments if the pandemic gets worse? Investors have piled into tech stocks like the FAANG as these investments seem reasonably secure. But, these stocks are also high-priced and not immune to a correction if sales fall off. And, sales could fall off as more and more people continue being out of work and without any discretionary spending. There are some companies that have done well during the pandemic and which stand to prosper if things get worse.
Safe Investments if the Pandemic Gets Worse
The Motley Fool suggests three stocks to buy ahead of a potential second wave of the virus. They are PayPal, Logitech, and Quidel.
PayPal has nearly doubled its stock price since the beginning of the year from $102 a share to $198. They are benefitting from the wholesale move of commerce online.
Logitech is a computer hardware maker that has also benefitted from the move of business and social activity online and from home. They have seen a nice stock price increase from $47 to $74 a share.
Making Covid-19 Tests is Profitable During the Pandemic
Quidel’s stock has gone from $74 a share to $241 a share since the first of the year. These folks make tests for Covid-19! Our opinion is that this company is in the best position of the three to do well if the pandemic worsens this fall. Their Lyra SARS-CoV-2 rapid assay test got emergency use authorization from the FDA in March and their Sofia 2 SARS Antigen FIA test that produces results in fifteen minutes was approved in May. As the Covid-19 virus reemerges as a problem across Europe, the UK, Japan, and other countries that had seen it subside, there will be a need for more testing across the globe. As the pandemic continues to grow out of control in the USA, the need in North America will be even greater. In the coming months and into at least 2021 one can expect to see Quidel to be a safe investment as the virus continues to be a major problem.
Other companies that make Covid-19 tests include Roche, Abbot Labs, and Thermo Fisher. However, these are larger companies for whom the benefit of making a Covid-19 is diluted by the success or failure of their other products and services.
How Long Will Covid-19-related Profits Last?
Companies that make tests for the Covid-19 virus and those that are developing vaccines are going to make money in the coming year or so. But, this may be a one-time occurrence no matter how dire the need is right now. If it turns out that the Covid-19 virus keeps mutating, there may be the need for vaccinations every year. Then, it will essentially be another “flu” shot. This can be a good business but not something exceptional. Thus, the companies like Quidel that are money-makers now will probably cool off in a year or two.
Safe Investments if the Pandemic Gets Worse – Slideshare