Covid-19 has spread to countries like Italy, Israel, South Korea, Austria, Switzerland, Croatia and Iran. In fact, healthcare officials have hinted that the virus has potential to be a global pandemic, which is enough to scare investors.
In the United States, the market has been witnessing turmoil, enough to push major benchmarks to close in the red. On Feb 25, the S&P 500 Index dropped 3%, the Dow fell 3.2% and the Nasdaq Composite closed 2.8% lower. Investors’ fear is quite evident as the fear-gauge CBOE Volatility Index’s (VIX) increased11.3% to close at 27.85, clearly indicating panic.
What’s more? On Feb 25, top U.S. health officials said that the spread of coronavirus in the country appears to be inevitable and also issued warning that conditions could be “severe.” This is pushing investors to purchase traditionally safe haven assets like gold, which touched a seven-year high.
Coronavirus Death Toll Rises
Covid-19 has not only disrupted business and everyday life in China but has also spread to various countries. The death toll has risen to seven in Italy, Iran has reported 16 deaths so far and nearly 100 cases of infection.
Per a recent report, Nancy Messonnier, director of the Centers for Disease Control and Prevention (CDC) National Center for Immunization and Respiratory Diseases, mentioned that the agency expects to see more cases in the United States. The country so far has 57 reported cases that include 40 people who had been repatriated from the Diamond Princess cruise ship.
Bruce Aylward of the World Health Organization (WHO), who headed an international expert mission to China, in his report warned that other nations were “simply not ready” to contain the outbreak.Officials have requested countries globally to “prepare for a potential pandemic.”
Coronavirus has caused 2,715 fatalities and infected more than 78,000 in China so far. Infections in South Korea have crossed 1,000, along with the first suspected case recorded in Latin America. With no cure available yet, the threat of the outbreak becoming a pandemic remains.
4 HealthCare Stocks to Buy
Healthcare companies globally are trying to find a cure and contain the outbreak. Given the spread of Covid-19, healthcare stocks seem to be a prudent investment as the potential discovery of a cure could lead to huge gains. We have picked four healthcare companies, each carrying a Zacks Rank #2 (Buy), which are working on developing treatment for the recent outbreak.
Moderna, Inc. (MRNA - Free Report) is a clinical stage biotechnology company that develops therapeutics and vaccines based on messenger RNA for the treatment of infectious diseases, immuno-oncology, rare diseases, and cardiovascular diseases. Post the coronavirus outbreak, the company has joined forces with the Coalition for Epidemic Preparedness Innovations (CEPI) on a vaccine approach. Moderna has also received new funding from CEPI to accelerate its work on a coronavirus vaccine.
The company’s expected earnings growth rate for the current year is 67.5% compared with the Zacks Medical - Biomedical and Genetics industry’s projected earnings growth of 8.1%.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Vaxart, Inc. (VXRT - Free Report) is a clinical-stage company that engages in the discovery and development of oral recombinant protein vaccines based on its proprietary oral vaccine platform. Post the virus outbreak, the company has initiated a coronavirus vaccine program using its proprietary oral-delivery platform.
The company’s expected earnings growth rate for the current year is 75.1% compared with the Zacks Medical - Drugs industry’s projected earnings growth of 12.1%.
Inovio Pharmaceuticals, Inc. is a late-stage biotechnology company, focused on the discovery, development, and commercialization of DNA-based immune therapies and vaccines to prevent and treat cancers and infectious diseases. Inovio is developing a vaccine to treat the MERS strain of coronavirus. Though the company’s drug has passed only Phase 1 benchmarks, management may be able to contribute its research toward the coronavirus effort. Additionally, the company is working along with CEPI.
The company’s expected earnings growth rate for the next quarter is 23.3% against the Zacks Medical - Biomedical and Genetics industry’s projected earnings decline of 73.5%.
Novavax, Inc. (NVAX - Free Report) is a late-stage biotechnology company that focuses on the discovery, development, and commercialization of vaccines to prevent serious infectious diseases. Post the virus outbreak, the company has launched a program for the coronavirus vaccine. Novavax already boasts success in vaccine development for the MERS and SARS strains.
The company’s expected earnings growth rate for the current year is 46% compared with the Zacks Medical - Biomedical and Genetics industry’s projected earnings growth of 8.1%.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>