The last six weeks have been among the most catastrophic in the history of the stock market. The Dow Jones Industrial Average just had its worst first quarter ever in terms of percentage drop (-20%). And growth stocks aren’t faring much better, with the Nasdaq down 17% year to date. But believe it or not, some stocks have not only held up well during this ongoing coronavirus crash; they’ve thrived.
Since February 19, when the S&P 500 peaked at all-time highs just before things went horribly south, these five large-cap stocks have actually posted meaningful gains (listed by largest market cap to smallest):
5 Large-Cap Stocks Immune to Coronavirus
Gilead Sciences (GILD): +7.7%
Regeneron Pharmaceuticals (REGN): +22%
Zoom Video (ZM): +30%
Domino’s Pizza (DPZ): +10%
Vipshop Holdings (VIPS): +16.3%
The top two make total sense: Gilead Sciences and Regeneron Pharmaceuticals are drug makers, and while their drugs won’t cure COVID-19 coronavirus, some healthcare stocks—particularly fast-growing companies like these two—are getting the benefit of the doubt right now.
The other three are a bit more surprising, at least on the surface. But there are very good reasons each of them has proven to be immune to this coronavirus market crash.
Zoom Video is a cloud computing company that provides remote conferencing software—a service that is in very high demand now that large swaths of the global population are either not permitted to congregate in person or afraid to.
Domino’s Pizza stock is living off a monster gap up on February 20 after the company reported very strong fourth-quarter earnings. DPZ is down considerably (-14.3%) since, though not nearly as much as the market.
Vipshop Holdings looks like the real surprise winner. It is, after all, a Chinese company, and Chinese stocks have understandably taken a pounding since the coronavirus originated in Wuhan more than three months ago. But shares of this discount online merchandise retailer jumped 27% in one trading session last month after the company reported much-better-than-expected fourth-quarter earnings. The company did warn that the coronavirus would likely put a 15-20% dent in first-quarter sales. However, Wall Street has yet to punish VIPS for that ominous warning, as it continues to trend higher.
Should you buy any of these against-the-grain large-cap stocks right now? You could. One of them, in fact, has become a regular in our Cabot Top Ten Trader momentum-stock advisory (to learn its name, click here). But I wouldn’t go snatching up all of them. When there’s this much turmoil and uncertainty in the market, it’s best to keep new buying to a minimum, instead holding plenty of cash for the inevitable market rally.
That’s when the real money will be made. Whether it happens three weeks from now or three months from now, who knows? But eventually, stocks will bounce back. When they do, opportunities to profit from the rebound will be many.
Having not only held up but flourished in the midst of the current sell-off, these five large-cap stocks look well positioned to continue their rise once the rebound arrives.
Investment analyst and Chief Analyst of Cabot Wealth Daily, Chris Preston brings you all the latest from the investing world. Sign up to get updates and breaking news delivered FREE to your inbox. Get unlimited access to our library of complimentary investing reports.Sign up now!
*This post has been updated from an original version.