These are the stocks to short when a COVID vaccine is ready, says JPMorgan

By Steve Goldstein

Last month, strategists at JPMorgan put a list of companies at risk of steep drops when a COVID-19 vaccine is ready.

In light of the news that a late-stage trial of the vaccine being developed by Pfizer /zigman2/quotes/202877789/composite PFE +1.92% and BioNTech /zigman2/quotes/214419716/composite BNTX +4.79% is more than 90% effective, it’s a good reference.

Strategists at JPMorgan have put together a list of companies that are at risk of steep drops. They are at the “upper echelon of momentum and have crowded positioning, that could see the second derivative of their profit growth decrease as consumer / corporate activity normalizes,” said the JPMorgan team. Some of the names, like Zoom Video Communications /zigman2/quotes/211319643/composite ZM +6.29% , are obvious, but the list also includes companies including education technology provider Chegg /zigman2/quotes/205655041/composite CHGG +3.36% and Central Garden and Pet Co. /zigman2/quotes/206292828/composite CENTA +0.87% that aren’t as well known.

Through October, this group of stocks has outperformed the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.24% by about 9%.

/zigman2/quotes/202877789/composite

Add to watchlist PFE

Pfizer Inc.

US : U.S.: NYSE

$ 37.23

+0.70 +1.92%

Volume: 25.28M

Nov. 27, 2020 5:00p

P/E Ratio

24.11

Dividend Yield

4.08%

Market Cap

$206.94 billion

Rev. per Employee

$586,070

/zigman2/quotes/214419716/composite

Add to watchlist BNTX

BioNTech SE ADR

US : U.S.: Nasdaq

$ 109.99

+5.03 +4.79%

Volume: 3.87M

Nov. 27, 2020 1:00p

P/E Ratio

N/A

Dividend Yield

N/A

Market Cap

$26.48 billion

Rev. per Employee

$92,777

/zigman2/quotes/211319643/composite

Add to watchlist ZM

Zoom Video Communications Inc.

US : U.S.: Nasdaq

$ 471.61

+27.89 +6.29%

Volume: 7.28M

Nov. 27, 2020 1:00p

P/E Ratio

607.04

Dividend Yield

N/A

Market Cap

$134.14 billion

Rev. per Employee

N/A

/zigman2/quotes/205655041/composite

Add to watchlist CHGG

Chegg Inc.

US : U.S.: NYSE

$ 75.01

+2.44 +3.36%

Volume: 1.29M

Nov. 27, 2020 5:00p

P/E Ratio

N/A

Dividend Yield

N/A

Market Cap

$9.66 billion

Rev. per Employee

$293,309

/zigman2/quotes/206292828/composite

Add to watchlist CENTA

Central Garden & Pet Co. Cl A

US : U.S.: Nasdaq

$ 37.28

+0.32 +0.87%

Volume: 111,044

Nov. 27, 2020 1:00p

P/E Ratio

16.82

Dividend Yield

N/A

Market Cap

$2.08 billion

Rev. per Employee

$427,859

/zigman2/quotes/210599714/realtime

Add to watchlist SPX

S&P 500 Index

US : S&P US

3,638.35

+8.70 +0.24%

Volume: 1.22B

Nov. 27, 2020 2:07p