Business Analysts named one of the main pandemic beneficiaries

Analysts named one of the main pandemic beneficiaries

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2020-03-27T05: 30 + 0300

2020-03-27T05: 30 + 0300

https://ria.ru/20200327/1569215551.html

Analysts named one of the main pandemic beneficiaries

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RIA News

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WASHINGTON, Mar 27 – RIA News. The American economy is going through hard times due to the coronavirus, analysts do not exclude the rise in unemployment at times, a recession, fan-shaped bankruptcies in the stock market. However, not all companies are in poor condition. Sellers of food, delivery, online education and entertainment services, by contrast, are making money from the crisis.

The leading US stock indices S&P 500 and Dow Jones over the past two months have lost everything that US President Donald Trump was so proud of. The pandemic and its associated panic in the stock market have led these two indexes to survive either the worst days of their history or from Black Monday 1987. But in these circumstances, there are several companies that can and should be invested in, analysts said by RIA Novosti are sure.

Crisis is not a hindrance

Despite the fact that “everything basically falls,” there are several “blue chips” in the US market that, according to Bank of America Merrill Lynch, need to be bought in 2020. The bank listed among them technology companies such as Netflix, Alphabet inc. (Google) and retailers Costco Wholesale Corp., Amazon Inc., Dollar General Corporation.

According to analysts at another bank, Morgan Stanley (quoted by Zero Hedge), it is American retailers that are experiencing a real boom. In the first weeks of March, retail sales of food products increased sharply – by 8%, which was an unprecedented growth for the business, which is extremely slowly increasing profits. Moreover, it is possible that growth will continue at double digits, the bank warns.

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In addition, American instant food companies such as Tyson react to market trends. They expanded the production of chicken, pork and beef products, reorienting the capacities that had previously been used to service restaurants closed because of the pandemic, to the direct consumer, and they also paid off.

The fact that American businesses selling food and household goods are separate from other retailers suffering losses was noted in their review by Moody “s.” Meanwhile, retailers such as supermarkets, pharmacies, shops and food warehouses will benefit, as consumers will stock up on food and other basic necessities, “said the rating agency.

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According to Moody’s, companies like Kroger, Walmart, Costco Wholesale, Target Corp. and Dollar General Corp. (a network of cheap grocery and household goods) and CVS Health (a network of pharmacies). Do their state authorities consider it necessary for life? therefore, they continue to work at full strength, according to an analytical review.

Go online

In addition, retailers who had a developed online sales platform before the crisis benefited greatly. Due to this, operating income in food stores such as Whole Foods (owned by Amazon), Walmart, and Kroger has grown significantly as consumers try to avoid shopping.

“Therefore, such companies are now attractive for investors. For example, Walgreens (a network for the sale of medicines and essentials), Duane Reads, Dominos pizza are also one of the positive exceptions in a falling market,” RIA Novosti, managing private assets of the American Sovereign Foundation Gary Korolev.

Kyle Shostak, managing director of Principal Investors, an American fund, adds that online retailers are also gaining momentum in addition to online retailers, food and household goods suppliers. For example, Graham Holding Company, which includes Kaplan education business. Quotes of the company over the past five days have grown by almost 14%, according to exchanges.

Amazon take off

But the most attractive of all (this particular company is present in all the top lists of investment banks and analysts) is Amazon. “Of these, Amazon, I would say, is the strongest,” says Korolev.

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He notes that the platform has gathered under its umbrella all the most attractive products and services for customers locked in a pandemic – entertainment (watching movies, books), food delivery (Amazon previously purchased Whole Foods grocery retailer) and essential goods. At the same time, it is Amazon that now has the most developed network of delivery centers throughout America.

In this regard, the company is currently experiencing rapid growth. At a time when analysts believe the US will be unemployed due to the crisis, the company plans to hire 100,000 new workers to collect, pack and deliver orders.
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However, Amazon is facing an extremely difficult task, how to cope with this growth without compromising reputation. Attorneys of 32 US states on Wednesday asked Amazon CEO Jeff Bezos to tighten control over price inflation for essentials on his platform due to coronavirus.

Prosecutors also cited a study by the US research group US PIRG, which found that prices for 1 out of 6 products sold directly through Amazon rose 50% due to the pandemic. Sometimes growth is 10 times. For example, a bottle of sanitizer, which began to cost $ 250 instead of $ 25.

However, earlier the online retailer assured that he was taking all necessary measures to prevent price inflation for the goods presented in his stores.

Latest situation data COVID-19 in Russia and the world are presented on the portal stopkoronavirus.rf.
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