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Which Industries have Thrived During the Pandemic?

Which Industries have Thrived During the Pandemic?

| July 06, 2020
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While at certain points Covid-19 has halted nearly every facet of the global economy, a few segments of the market are thriving, leading to a bifurcation between economically sensitive businesses and those well positioned to serve the stay at home masses.  

The emergence of the pandemic has facilitated an accelerated adoption of direct-to-consumer and direct-to-home world as the largest captive audience the market has ever known remains glued to connected devices. Businesses tied to technology have benefited in areas such as retrofitting connectivity capabilities in work from home environments. Consumers on the other hand have shifted their spending habits to an even larger emphasis on ecommerce in areas such as food delivery, interactive workout classes, online pharmacies, and streaming services. Within the payment processing space, PayPal recently reported payment volume growth of 22% in the month of April alone due to higher trends in online shopping. Similarly, companies using cloud computing technology have also experienced increased growth, such as Microsoft which has experienced robust demand for its new collaboration app Microsoft Teams.

Other traditional areas of the market, including consumer staples -- grocery stores, personal care, pharmacy chains, medical supplies -- are similarly enjoying a windfall in demand for their products and services. Both Walmart and Target are seeing same store sales surge as both businesses have adopted new technological platforms within their omni-channel strategy.  Creating multiple touchpoints outside traditional brick and mortar has allowed customers the convenience of online shopping, touchless drive-up pickup, and same day delivery. As the unemployment rate in the U.S. has spiked to a multi-decade high, Amazon is bucking the trend with the announced hiring of 175,000 employees to keep up with demand -- a welcome sign for shareholders as its stock price reaches all-time highs.

In the midst of a competitive business environment, with many companies laden with debt, companies fortunate enough to enter the pandemic with well-defined business models, an economic moat around competitors, strong balance sheets, and solid free cash flow are poised to see accelerated market share gains.

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