Bulletin
Investor Alert

April 24, 2020, 8:08 a.m. EDT

Stock winners and losers in the post-Covid 19 work-from-home world

Arranging your home for work and play will benefit many companies, from consumer-electronics makers to home-furnishings purveyors

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    Activision Blizzard Inc. (ATVI)
  • X
    Zynga Inc. Cl A (ZNGA)
  • X
    Planet Fitness Inc. Cl A (PLNT)

or Cancel Already have a watchlist? Log In

By Michael Brush, MarketWatch

1 2

Virtual desktops

Cloud-based desktop virtualization systems store employee desktops remotely on servers instead of locally on devices. This helps remote employees access their work desktops from many different devices including PCs, smart phones and iPads, which makes it easier to work from home. The work-at-home trend will help companies that offer virtual desktop software like Citrix /zigman2/quotes/206700852/composite CTXS +0.25% , VMware /zigman2/quotes/209864107/composite VMW -1.41% and Microsoft, says Jefferies analyst Brent Thill.

Security plays

As more people work at home, it’s easier for thieves and trouble makers to break into computer systems. So this trend will increase security spending. Thill says this will benefit CrowdStrike /zigman2/quotes/212513426/composite CRWD -7.75% , Varonis /zigman2/quotes/204126818/composite VRNS -2.43% , Palo Alto Networks /zigman2/quotes/207599953/composite PANW -1.74% , Okta /zigman2/quotes/210420951/composite OKTA -4.18% and Ping Identity /zigman2/quotes/214130089/composite PING -2.07% .

Nuts-and-bolts stocks

Increased communication from remote locations will boost internet traffic, putting a burden on network infrastructure and forcing telecom companies to increase investments in equipment. This will benefit Ciena /zigman2/quotes/208745450/composite CIEN +0.07% , Juniper /zigman2/quotes/207361368/composite JNPR +0.66% , Arista Networks /zigman2/quotes/206966450/composite ANET -2.36% and CommScope /zigman2/quotes/206734450/composite COMM -0.50% , says Jefferies analyst George Notter. The work-from-home trend should also benefit Equinix /zigman2/quotes/208927761/composite EQIX -0.05% , which is a data-center real estate investment trust, or REIT.

Higher demand for cloud servers, laptops and home computers, routers and communications-infrastructure equipment will boost demand for chips. Broadcom /zigman2/quotes/200646538/composite AVGO -0.98%  and Inphi /zigman2/quotes/208445412/composite IPHI -2.42% are companies that have a lot of exposure to this trend, says Jefferies analyst Mark Lipacis.

Potential losers

The shares of two types of companies might not rise as much as the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.06%  or the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.17%  as the economy rebounds from the lockdown recession. First, if more people are working from home, the rebound in the economy won’t necessarily translate into demand growth for office space.

“We see the most downside for New York City office REITs such as SL Green /zigman2/quotes/208985878/composite SLG +2.75% , says Jefferies analyst Jonathan Petersen.

A recent study by Jefferies suggests 90% of women go makeup free while working from home. So increased work from home would exacerbate the trend toward using less makeup, already in place since 2018. Jefferies analyst Stephanie Wissink thinks elf Beauty /zigman2/quotes/202760864/composite ELF -2.58% will face headwinds because of this.

At the time of publication, Michael Brush had no positions in any stocks mentioned in this column. Brush has suggested ATVI, PLNT, LOW, HD, MSFT, and PANW in his stock newsletter, Brush Up on Stocks. Brush is a Manhattan-based financial writer who has covered business for the New York Times and The Economist Group, and he attended Columbia Business School.

/zigman2/quotes/206700852/composite
US : U.S.: Nasdaq
$ 141.14
+0.35 +0.25%
Volume: 1.14M
Aug. 7, 2020 4:00p
P/E Ratio
23.86
Dividend Yield
0.99%
Market Cap
$17.44 billion
Rev. per Employee
$362,671
loading...
/zigman2/quotes/209864107/composite
US : U.S.: NYSE
$ 142.31
-2.03 -1.41%
Volume: 630,509
Aug. 7, 2020 4:00p
P/E Ratio
9.48
Dividend Yield
N/A
Market Cap
$59.64 billion
Rev. per Employee
$413,548
loading...
/zigman2/quotes/212513426/composite
US : U.S.: Nasdaq
$ 101.75
-8.55 -7.75%
Volume: 6.64M
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$21.98 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/204126818/composite
US : U.S.: Nasdaq
$ 118.18
-2.94 -2.43%
Volume: 412,710
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$3.72 billion
Rev. per Employee
$185,129
loading...
/zigman2/quotes/207599953/composite
US : U.S.: NYSE
$ 261.25
-4.63 -1.74%
Volume: 826,012
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$25.20 billion
Rev. per Employee
$484,742
loading...
/zigman2/quotes/210420951/composite
US : U.S.: Nasdaq
$ 208.23
-9.08 -4.18%
Volume: 1.74M
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$25.95 billion
Rev. per Employee
$255,768
loading...
/zigman2/quotes/214130089/composite
US : U.S.: NYSE
$ 36.35
-0.77 -2.07%
Volume: 1.44M
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$2.92 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/208745450/composite
US : U.S.: NYSE
$ 60.99
+0.04 +0.07%
Volume: 1.27M
Aug. 7, 2020 4:00p
P/E Ratio
29.68
Dividend Yield
N/A
Market Cap
$9.37 billion
Rev. per Employee
$536,617
loading...
/zigman2/quotes/207361368/composite
US : U.S.: NYSE
$ 25.94
+0.17 +0.66%
Volume: 2.82M
Aug. 7, 2020 4:00p
P/E Ratio
25.28
Dividend Yield
3.08%
Market Cap
$8.61 billion
Rev. per Employee
$500,646
loading...
/zigman2/quotes/206966450/composite
US : U.S.: NYSE
$ 230.80
-5.58 -2.36%
Volume: 1.08M
Aug. 7, 2020 4:00p
P/E Ratio
24.58
Dividend Yield
N/A
Market Cap
$17.55 billion
Rev. per Employee
$935,378
loading...
/zigman2/quotes/206734450/composite
US : U.S.: Nasdaq
$ 11.02
-0.06 -0.50%
Volume: 5.38M
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$2.17 billion
Rev. per Employee
$228,425
loading...
/zigman2/quotes/208927761/composite
US : U.S.: Nasdaq
$ 791.70
-0.36 -0.05%
Volume: 224,852
Aug. 7, 2020 4:00p
P/E Ratio
137.35
Dividend Yield
1.34%
Market Cap
$70.11 billion
Rev. per Employee
$643,674
loading...
/zigman2/quotes/200646538/composite
US : U.S.: Nasdaq
$ 325.93
-3.23 -0.98%
Volume: 1.42M
Aug. 7, 2020 4:00p
P/E Ratio
58.33
Dividend Yield
3.99%
Market Cap
$131.08 billion
Rev. per Employee
$1.42M
loading...
/zigman2/quotes/208445412/composite
US : U.S.: NYSE
$ 125.39
-3.11 -2.42%
Volume: 660,742
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$6.05 billion
Rev. per Employee
$507,741
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
3,351.28
+2.12 +0.06%
Volume: 2.28B
Aug. 7, 2020 5:10p
loading...
/zigman2/quotes/210598065/realtime
US : Dow Jones Global
27,433.48
+46.50 +0.17%
Volume: 324.93M
Aug. 7, 2020 5:10p
loading...
/zigman2/quotes/208985878/composite
US : U.S.: NYSE
$ 48.62
+1.30 +2.75%
Volume: 1.02M
Aug. 7, 2020 4:00p
P/E Ratio
17.96
Dividend Yield
7.28%
Market Cap
$3.78 billion
Rev. per Employee
$1.44M
loading...
/zigman2/quotes/202760864/composite
US : U.S.: NYSE
$ 20.01
-0.53 -2.58%
Volume: 883,037
Aug. 7, 2020 4:00p
P/E Ratio
64.99
Dividend Yield
N/A
Market Cap
$1.01 billion
Rev. per Employee
$645,978
loading...

Michael Brush is a Manhattan-based financial writer who publishes the stock newsletter Brush Up on Stocks. Brush has covered business for the New York Times and The Economist group. He attended Columbia Business School in the Knight-Bagehot program.

1 2
This Story has 0 Comments
Be the first to comment
More News In
Investing

Story Conversation

Commenting FAQs »
Link to MarketWatch's Slice.