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March 27, 2020, 9:24 a.m. EDT

The COVID-19 Apocalyptic Scenario - Luckily, Not for Tech and Those Relying on Tech!

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Mar 27, 2020 (IAM Newswire via COMTEX) -- Big Tech

We have all been witnessing how the coronavirus outbreak managed to hurt the stock market in the past weeks, while we wait for serious government incentives and measures to help the most affected parts of the economy cope with the situation. The FAANG stock, which includes Facebook, Inc. /zigman2/quotes/205064656/composite FB -0.16% , Amazon.com, Inc. /zigman2/quotes/210331248/composite AMZN +1.72% , Apple Inc. /zigman2/quotes/202934861/composite AAPL -0.10% , Netflix, Inc. /zigman2/quotes/202353025/composite NFLX +1.52% , and Google by Alphabet Inc. /zigman2/quotes/205453964/composite GOOG +0.86% , will manage to go through this crisis maybe even with gaining some benefits. The quarantine and self-isolation made people rely much more on digital services, whether those are online shopping and delivery, using more streaming services, social media, and similar. So tech is doing just fine on one hand, but those who rely on advertising are in for a slightly different storyline.

Which companies will be most affected by the drop in advertising businesses?

It is not a surprise that both Facebook and Twitter, Inc. /zigman2/quotes/203180645/composite TWTR -1.99% reported an increase in the usage of their services. On the other hand, the COVID-19 managed to hurt companies' advertising business segments as this is the first to go when companies are forced to cut down on costs. But even with drops in those segments, most big tech companies are generating more than enough free cash flow, measured in tens of billions, assuring there is no chance of liquidity risk in any of these bad scenarios. But this short-term situation was enough for the Wall Street analysts to decrease their estimates for these and many other companies. For example, Google's target price was decreased, as well as the estimated earnings per share.

On the other hand, Google's flexibility which comes from liquidity of over $100 billion, and its leadership position, will help the company bounce back to its previously estimated results quickly once the situation stabilizes.

Nike reported growth in digital sales

NIKE, Inc. /zigman2/quotes/203439053/composite NKE +0.37% had to temporarily close most of its shops worldwide when the outbreak took place in China. On the other hand as the epicenter moved to Europe, 80% of its shops in China were reopened. Closing of its shops in China brought a decline of 5% in sales in the last financial quarter (which ended in February), and that was the first drop in sales in China after almost six years. This drop could have been even higher if there was not a strong increase in online sales by 36%. Also, Nike's personal training app usage was up 80% in China, due to the lockdown and many people staying at home. So despite the slump in retail caused by disruption both in the supply chain and the demand side, Nike managed to do just fine!

Outlook

It seems that Big Tech has a lot to gain during this unforeseen health crisis that is upon the world. As one fourth of the world's population is in self-quarantine, consumer behavior is bound to change dramatically- and they are first in line to pick up on these new trends. And what we can see from Nike is that anyone who is wise enough to use technology and that means having the knowledge and knowing how to apply it will derive the same benefits as people will be forced to work and live through their computers for quite a few weeks to come. Long live technology, e-commerce and streaming!

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you're interested in becoming an IAM journalist contact: contributors@iamnewswire.com Questions about this release can be send to ivana@iamnewswire.com

The post The COVID-19 Apocalyptic Scenario - Luckily, Not for Tech and Those Relying on Tech! appeared first on IAM Newswire .

COMTEX_363897806/2618/2020-03-27T09:23:30

/zigman2/quotes/205064656/composite
US : U.S.: Nasdaq
$ 225.09
-0.37 -0.16%
Volume: 23.32M
May 29, 2020 4:00p
P/E Ratio
30.84
Dividend Yield
N/A
Market Cap
$641.30 billion
Rev. per Employee
$1.57M
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/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 2,442.37
+41.27 +1.72%
Volume: 3.53M
May 29, 2020 4:00p
P/E Ratio
116.67
Dividend Yield
N/A
Market Cap
$1218.20 billion
Rev. per Employee
$359,671
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/zigman2/quotes/202934861/composite
US : U.S.: Nasdaq
$ 317.94
-0.31 -0.10%
Volume: 38.40M
May 29, 2020 4:00p
P/E Ratio
24.92
Dividend Yield
1.03%
Market Cap
$1378.06 billion
Rev. per Employee
$1.98M
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/zigman2/quotes/202353025/composite
US : U.S.: Nasdaq
$ 419.73
+6.29 +1.52%
Volume: 5.27M
May 29, 2020 4:00p
P/E Ratio
84.95
Dividend Yield
N/A
Market Cap
$184.60 billion
Rev. per Employee
$2.22M
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/zigman2/quotes/205453964/composite
US : U.S.: Nasdaq
$ 1,428.92
+12.19 +0.86%
Volume: 1.84M
May 29, 2020 4:00p
P/E Ratio
28.83
Dividend Yield
N/A
Market Cap
$769.02 billion
Rev. per Employee
$1.39M
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/zigman2/quotes/203180645/composite
US : U.S.: NYSE
$ 30.97
-0.63 -1.99%
Volume: 39.43M
May 29, 2020 3:59p
P/E Ratio
19.21
Dividend Yield
N/A
Market Cap
$24.30 billion
Rev. per Employee
$776,112
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/zigman2/quotes/203439053/composite
US : U.S.: NYSE
$ 98.58
+0.37 +0.37%
Volume: 10.33M
May 29, 2020 4:00p
P/E Ratio
36.48
Dividend Yield
0.99%
Market Cap
$153.29 billion
Rev. per Employee
$529,466
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