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Winners and Losers of COVID-19


Despite economic activity seemingly slowing to a halt (gross domestic product shrank at an annual rate of 32.9% in the second quarter of 2020), there have been some serious winners (and losers) in the age of COVID, lockdown and work from home mandates.  

Restaurants, retailers and commercial real estate have all suffered massive blows.  While e-commerce and certain technology companies have thrived.  Those anointed by the federal reserve and central government have also seen gains as a result of policy changes that could leave ripples through the market for decades.

I wanted to explore – in a series of write ups – which companies are winning, and which are losing, in this new world.

I broke it down into four different segments:

  1. Winners, Public Markets
  2. Winners, Private Markets
  3. Losers, Public Markets,
  4. Losers, Private Markets

Without further ado, let’s dive into the winners of the public markets.

Public Markets:

“Money never sleeps, pal.”
[Because the markets are subject to sweeping change, I’ll note these are based on numbers as of 9/14/20; public markets are alyways subject to sweeping change]

In terms of winners, the easiest to analyze are the public companies.  

I wanted to look at companies both in terms of their gains in stock price, as well as their gains in market cap (something that ultimately is more interesting).  

Now, when I am talking about winners, I am not necessarily speaking of a pure increase in stock price.  Or even market cap. Much like what happened during the 90s boom, momentum can matter more than fundamentals in the current market.

Many old school investors following the Graham and Dodd model of value investing (Buffet’s school of thought) tend to think of a company’s performance first, and the stock price as a secondary consequence of that. 

However, a company’s stock performance can be a self-fulfilling prophecy.  A hot stock can take a company that was heretofore not generating significant revenues and give it an injection of press and capital that allows it to succeed.  We are seeing that play out across a variety of companies. Say the right things, investors pile in, and you are now viable.    

So with that in mind, let’s take a peek at what’s happening. Looking year-to-date (as of 9/14/20), here are the some of the top gainers in equities across all US exchanges:

Top 15: Pharma Dominates

SymbolNameYTD %ChgLastChange%ChgYTD ChgYTD HighYTD LowYTD Avg Vol
NVAXNovavax Inc2385.30%
VXRTVaxart Inc1996.98%7.942.6449.81%717.490.316678643
TRILTrillium Therapeutic1363.11%15.030.986.98%14.0415.361.053228359
BTBTGolden Bull Limited1324.24%4.640.061.31%4.375.50.28435799
CODXCo-Diagnostics Inc1243.16%12-1.71-12.47%11.1330.990.887938941
WTRHWaitr Holdings Inc1058.42%3.66-0.11-2.92%3.415.850.266738662
GNPXGenprex Inc1037.50%3.670.174.86%3.327.030.264219811
OSTKOverstock.com Inc929.08%
NLSNautilus Group771.42%
WKHSWorkhorse Grp711.18%24.721.034.35%21.6224.871.3212049554
IBIOIbio Inc707.23%
ADAPAdaptimmune Ther Ads690.00%9.481.5419.40%8.2813.41.152021921
MCRBSeres Theraptc682.32%27.021.525.96%23.54332.521279118
PEIXPacific Ethanol Inc663.08%5.020.398.42%4.315.330.222469436
ALTAltimmune Inc592.33%

It’s no surprise that pharmaceutical companies specializing in vaccines have been buoyed by the pandemic.  They stand to gain huge if they capture a piece of the vaccine market for COVID-19, and investors are betting on these companies to do so.  

9 of the top 15 gainers in stock price across all US exchanges this year have been in Pharma/Immunology and vaccines.  Much like war is good for weapons manufacturers, pandemics are good for pharmaceutical companies.  

Meme Stocks: Retail Investor Heaven

[NOTE: This is outdated re: Nikola. Didn’t I tell you that the public markets are always open to sweeping change? Nikola committed fraud, and is now down nearly 75% from its peak. Sometimes the fugazi gets exposed].

Huge meme stocks like Zoom (20), Tesla (29) and Nikola Corp. (67) also came in huge this year, up ~487%, 378% and 237% respectively.  

None of these companies are displaying revenue or profits that justify these valuations and run-ups.  But a combination of low rates from the fed (all but forcing invest in assets like stocks and real-estate), along with a fear of missing out from both retail investors and institutional investors, have pushed these stocks to new heights.   

SymbolNameYTD %ChgLastChange%ChgYTD ChgYTD HighYTD LowYTD Avg Vol
ZMZoom Video Communications Cl A486.57%400.8317.834.66%331.0647865.8110209361
TSLATesla Inc378.09%407.3434.629.29%316.33502.4970.186309602
NKLANikola Corp.237.02%33.351.223.80%24.4693.9910.311364917

Tech Takeover: WFH Wave Riders

Other tech companies that are taking advantage of the new work from home and quarantine paradigm have also shown out this year.  

SymbolNameYTD %ChgLastChange%ChgYTD ChgYTD HighYTD LowYTD Avg Vol
PTONPeloton Interactive Inc188.22%80.24-3.8-4.52%53.4698.6117.79407029
DOCUDocusign Inc174.49%203.345.42.73%129.31290.2364.884369661
SHOPShopify Inc135.68%941.3226.822.93%539.431146.91305.32878725
NVDANvidia Corp118.71%51629.426.05%279.31589.07180.6813056313
WIXWix.com Ltd110.98%257.953.851.52%135.82319.3476.81854191
PINSPinterest Inc93.29%35.971.865.45%17.3939.6410.114787246
ZZillow Group Cl C90.16%87.051.671.96%41.4292.8120.043911945

Peloton has absolutely obliterated expectations and is a great example of being in the right place at the right time. With few gyms open, and low demand to go to them besides, Peloton served demand from people wanting to get a workout in at home.  

Docusign has become even more instrumental in the age of COVID than it was before it- as meetings move almost exclusively online. Contracts still need to be signed, and they aren’t being signed in the office.     

Shopify has taken advantage of the boon in e-commerce during this period.  Retail companies that previously sold their wares in brick and mortars are increasingly needing to move online.  For those who don’t want to give the majority of their profit margin to Amazon, Shopify is a key platform.  

Twilio provides technologies that allow for voice and video communication – clearly big during the work from home era.  

Square – despite losing business from point of sale devices in retail, are processing more payments than ever online.  This is a big and growing space.  

Nvidia makes chips for all of the technologies that are rapidly becoming more important to the future economy – especially in an increasingly online world.  Their chips for gaming, data centers and AI make them well positioned for the future, and the now.    

Wix has succeeded because web development has become commoditized.  A new “no code” wave has overtaken the industry, and more products are rising up to allow for drag and drop creation of websites. Wix is a leader in this space.  

Pinterest is an interesting success story, but due to people’s increased time on their hands and hunger for online shopping, the company is well positioned.  For years now, Pinterest has focused on building out its e-commerce muscle and technologies (for clothing primarily) and have created a great system for users to find and purchase items.  

Zillow is succeeding based on the fervor for home buying brought on by low interest rates and the need for space as more people work from home. This is an interesting trend to watch, as it is yet to be seen if this level of demand can keep up. Mortgage defaults are being kept at bay by forbearance mandates. Once that forbearance is lifted, it will be interesting to see the effect it will have on the housing market, and on Zillow’s business (which derives a large part of their revenue from premier listings from agents, etc…).     

Share Price Winners, Sorted by Market Cap: More Tech Dominance

If we take the chart of the 250 or so companies that increased their stock price the most this year, and sort them by market cap, technology dominance becomes even more clear:

SymbolNameMarket Cap (in billions $)P/E ttmEPS ttmNet Income(a)BetaDividend(a)Div Yield
TSLATesla Inc$389970.630.39-8620000001.6300.00%
NVDANvidia Corp$31879.126.1527960000001.530.640.13%
ZMZoom Video Communications Cl A$115440.230.8725310000-1.2400.00%
SHOPShopify Inc$11200.07-1248400001.3700.00%
JDJd.com Inc Ads$11290.460.8217501400000.9700.00%
PDDPinduoduo Inc ADR$950-1.09-1.00E+091.1800.00%
VEEVVeeva Systems Inc$40152.031.743011200000.9500.00%
DOCUDocusign Inc$380-0.83-2083600000.8600.00%
CRWDCrowdstrike Holdings Inc$280-0.53-1417800001.1200.00%
DDOGDatadog Inc Cl A$260-0.01-16710000N/A00.00%
WWayfair Inc$250-6.9-9845800003.4800.00%
CARRCarrier Global Corporation [Carr/I]$2500.682116000000N/A0.321.09%
MRNAModerna Inc$250-1.4-5140200000.4700.00%
PTONPeloton Interactive Inc$230-1.42-195600000N/A00.00%
PINSPinterest Inc$220-0.71-1.36E+091.8800.00%
GSXGsx Techedu Inc ADR$21421.650.232560000-0.600.00%
ZZillow Group Cl C$200-1.66-3053600001.2100.00%

17 of the top 20 companies that saw the most growth by share price this year, when sorted by market cap, were technology companies.  TSLA’s meme strength has catapulted it to the top spot on this list.  

This was a trend that had been taking hold in society for a while now, but the age of COVID-19 ushered in the final death knell for certain “traditional” business. Technology rules in this era, and likely will going forward. 

Top Gainers by Market Cap: Tech Again

One final slice for winners I wanted to look at, was that of gain in market cap by the raw numbers.  I looked at the top 30 companies currently by market cap on the US exchanges, and their growth YTD in market cap.  

The same story seems to hold.  Tech stocks are dominating in terms of market cap growth (even at huge scale).  Companies that are not technology based, or holding companies refusing to take advantage of tech gains, are being left behind.  

Note Tesla and how much this stock had to rocket to get into the upper echelons of market cap: +437% market cap gain YTD.  Don’t underestimate meme strength.  The next closest company on this list was Amazon, coming in with +67% market cap growth.  

Other companies bringing in over 50% market cap growth: Apple, Salesforce, Netflix, PayPal.  Again, all technology based.  

Bank stocks were the biggest losers YTD on this list.  JPM and BAC lost ~ 30% each in market cap YTD.  But we’ll get into that in my next installment.  

RankAsset NameSymbolMarket Cap (jan 1 2020) – (in trillions $)Market Cap – current – (in trillions $)Mark Cap Raw Gain – (in trillions $)Market Cap % GainPrice
4Alphabet AGOOGL0.9411.0470.10611.26%$1,539.28
6Alibaba Group HoldingBABA0.5900.7500.16027.12%$277.32
8Berkshire Hathaway BBRK.B0.5570.523-0.034-6.10%$219.00
9Taiwan Semiconductor ManufacturingTSM0.3110.4470.13643.73%$86.26
12Johnson & JohnsonJNJ0.3840.3930.0092.34%$149.41
14Procter & GamblePG0.3050.3450.04013.11%$138.50
17Home DepotHD0.2400.3080.06828.55%$285.88
18JPMorgan Chase & CoJPM0.4350.305-0.130-29.89%$100.11
19UnitedHealth GroupUNH0.2770.2940.0176.14%$309.12
20Verizon CommunicationsVZ0.2520.251-0.001-0.40%$60.77
22Walt Disney CompanyDIS0.2640.238-0.026-9.85%$131.96
24Bank of AmericaBAC0.3150.220-0.095-30.16%$25.36
25Coca-Cola CompanyKO0.2350.219-0.016-6.81%$51.05
28Intel CorporationINTC0.2610.215-0.046-17.62%$50.44
29Comcast CorporationCMCSA0.2070.2130.0062.90%$46.66
30Merck & CoMRK0.2340.213-0.021-8.97%$84.14

An ongoing refrain that has been passed around the internet is that the Fed is selectively buoying specific equities.  There may be some of that going on, but the sheer dominance from technology companies during this period that fit naturally into a post-in person world tell another story.  

  1. As companies and people become more distributed, COVID-19 may have just accelerated a trend that was inevitable.  The companies that are succeeding in the stock market, are also seeing their underlying businesses succeed (or have a clear path to dominance in their respective fields).  
  2. Investors are incentivized right now to be in equities (due to low interest rates), and the only equities that seem to make sense are based on technology companies that are serving this new paradigm.  

Next up, we’ll discuss the biggest winners in the private markets.  Stay tuned!


Interested in chatting about the winners and losers of COVID? Reach out to me on Twitter Instagram  or LinkedIn.  

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Also, if you’re interested in getting a more hands on approach from me on how to build companies, both at scale and just starting out, reach out to michael@formatagency.co to discuss advisory services.

Check out more awesome content at the blog.

By Michael S

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