Just like that, the market is abandoning the work-from-home stocks.
Promising news from
(ticker: PFE) on Monday on the prospects for a Covid-19 vaccine has the stock market roaring—or at least, most of the market. The
is up 2.9%. Clearly left out of the party are some of the year’s best-performing stocks, companies that have seen a clear benefit to their businesses—and their share prices—from the shift to working, learning and playing from home.
Here is a quick look and which stocks are, uh, staying at home on a day when the market is betting on a return to normalcy.
Zoom Video Communications
(ZM) is down 15%. No company is more emblematic of the way American’s have been living in 2020 that Zoom and its videoconferencing service. Zoom shares were up more than 600% year to date through Friday. One major lesson of the pandemic has been that effective meetings can take place virtually. It isn’t a passing fad, but the prospect of a vaccine also raises hopes that eventually we can start holding more meetings, classes and events the old-fashioned way. In the flesh.
(PTON) is down 20%. The maker of stationary bikes and other inernet-connected workout gear has been a huge beneficiary of the shutdown of the nation’s gyms, with supply constraints on bikes and long waits for delivery. With a vaccine, we can all go back to taking spin classes in person.
(ROKU) is down 10% and
(NFLX) is down 4%. The prospect of a vaccine also opens up the potential for a return to movie theaters, live-music venues, sporting events and other forms of entertainment other than streaming video. Note that the theater chain
(AMC) is up 40%, while
(DIS) is up 13%.
(TDOC) is down 8%. The pandemic likely sped up adoption of virtual medical office visits, but the prospect for a return to normalcy suggests some appointments will shift back to actual offices.
(CHWY) is down 9%,
(SHOP) is down 6%,
(ETSY is off 13%,
(W) is down 14%,
(OSTK) is off 15%,
(EBAY) is down 4% and
(AMZN) is down 1%. It isn’t too hard to see what’s happening here. A widespread and effective vaccine will make it safe to go to the mall again, reduce the pressure on offline retailers to focus on e-commerce, and allow more people to buy pet food, home furnishings and groceries the old-school way.
(CHGG) is down 13%. The online education-software company has benefited from the switch to learning from home, and the stock is backtracking on the prospect for a return to the classroom.
Cloud software stocks are selling off, with
(ZS) down 9%,
(COUP) down 2%,
(RNG) down 4%,
(DOCU) down 9%, and
(OKTA) down 3%. Some of the stocks in this group have been seen as beneficiaries from a shift to work from home, but they have also maintained durable double-digit growth despite the economic downturn. In short, they have been bid up in part because the cloud has offered one of the primary ways to find growth—and a return to normalcy gives investors more options. For these stocks, the issue might have less to do with a change in the tone of business and more to do with some air coming out of some highfliers.
Write to Eric J. Savitz at [email protected]