8 stocks to watch amid the Covid-19 crisis

Amid the current crisis, stock market all across the world took a severe hit in response to the shutdown of numerous economic sectors and the lockdown of more than half of the global population. However, even though in some cases like Lufthansa or GM the fall in stock prices seems justified given the impact of the Covid-19 crisis on their foreseeable profits, in the technological sector the situation at the moment does not seems optimal. Indeed, given the soaring demand registered by companies like Netflix or Amazon and the probable prolongation for several months of the partial lockdown coupled with the evolution of working habits towards more digitalization, the fact that many tech stocks are still under their valuation of February appears to leave room for further arbitration. So without further ado, here is our 8 best picks  for 2020 among the tech sector :

1) Facebook (FB)

Due to the market sell-off, FB trades for just 28 times earnings which is quite a good opportunity for a company expected to grow 41% this year and still grows its users database by 8% annually. Furthermore, even if a Democrat is elected in 2020 and still pushed for a breakup of FB after the Covid-19 crisis that dialed down this narrative, investors might still benefits as Wall Street would be better suited to fully value each business segment. 

2) Amazon (AMZN)

Being on the forefront of the fight against the current pandemic by allowing institutions and millions of clients to obtain medical goods the company will surely come out reinforce of this crisis, and gain new users once the crisis will be over thanks to the evolution of the consumption habits throughout the population. Also, on a more technical side, the world leader in cloud computing solution is now well suited to be on the forefront of the robotic revolution through the deployment up to 2025 of more than 100K of its Kiva robots and continues to push it effort in the promising field of AI powered Voice Recognition through its flagship product Alexa.

3) STMicroelectronics (STM)

Trading for a lowly price-earning_growth (PEG) ratio of 0.44, analysts expect earning per share to grow 49% annually for the next five years making its P/E of 22 looking like a very good deal in the current market meltdown. Indeed, this Swiss semiconductor company producing chips for the automotive sector as well as smartphone wireless chargers and data center power solutions needed for the coming 5G transition appears to be well suited to benefit greatly of the years to come.

4) Micron (MU)

All future trends will be most likely a result of data creation from the incredible amount of data generated by AI to AR/VR and autonomous driving it will require significantly higher memory both NAND and DRAM, creating as such a strong and long term demand for this chips producer who remains one of the top stock to hold in this technological area alongside Nvidia.

5) Alibaba Group Holding (BABA)

This analogue to Amazon in the US is still growing at a fast pace, surging 38% on the last quarter despite generating already more than $70 billion annually. Moreover, as in the case of Amazon, the company will most likely benefit from the Covid-19 crisis given it’s massive retail division and the earlier exit of lockdown compare to the US which could help it acquire new markets and also continue to develop now more than ever its booming cloud computing business as well as its entertainment division.

6) CRISPR (CRSP)

The company’s current cash position of  $943.8 million at the close of 2019 covers around 4 years of expenses which should be enough to wait out the current crisis. Additionally, CRISPR is now teaming up with Vertex Pharmaceuticals, Bayer and ViaCyte and as such will be able to advance more easily new drug candidates through the different phase of clinical trial for their novel gene-editing therapy CTX-001 treatment which is still under development despite the current crisis. Furthermore, with this crisis more and more researchers and mainstream media are starting to talk about gene therapy as one of the possible solutions. In this sense, it appears interesting to profit of the current reset in price to jump on the bandwagon of the gene editing sector.

7) Sangamo (SGMO)

With a little bit over 2 years of cash reserve, this other main company of the gene editing industry also appears well equipped to face the current crisis especially since the unveiling of its new partnership with Biogen coming in addition to the ones already existing with Pfizer, Kite Pharma, Sanofi and Gilead. Moreover, the company is currently trading close to its cash balance which makes it a good opportunity to buy into the stock.

8) Tesla (TSLA)

With the recent news of GM delaying some SUV, trucks and sports car launches and Rivian (in which Ford has a stake) pushing back its R1T and R1S rollouts due to the Covid-19 crisis, Tesla will be favored in the medium term as there would be less competition from higher quality electric vehicle. Furthermore, as pointed out Morgan Stanley in a recent analysis, the company could also very well profit a lot from the recent US government stimulus thanks to its advanced driver-assistance system as automakers will lobby Congress to consider safety technology in the distribution formula.