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Coronavirus-Led Panic Confines People to Necessities: 4 Picks

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The coronavirus pandemic continues to weigh on smooth operations of businesses and supply chains, rendering volatility to financial markets. Within a month, the three major U.S. benchmark indexes have shed more than 25% each as panicked investors continue with their sell-off.

After all, the deadly Wuhan-originated virus is highly contagious and is wreaking havoc on daily life and deflating investors’ optimism. Wall Street’s fear is clearly reflected in the CBOE Volatility Index, which settled at 78.29 on Mar 18 after adding 2.4%.

Social Distancing in Place

In a bid to stop the virus from spreading, the Centers for Disease Control and Prevention on Mar 15 recommended an upper limit of 50 people to gather at any kind of events in the country for the next eight weeks. Academic institutions and business hubs are exempted from this directive.

The coronavirus pandemic, which has rampantly affected more than 221,000 people across the globe as of Mar 19, is clearly impacting economic activities, thereby hurting the U.S. and global economy by and large. As the pandemic shows no signs of slowing down, one can’t rule out further disruption in daily life and economic activities ahead.

Stocks Strongly Braving the Pandemic

This is why many companies across the country have advised their employees to work from home for the next couple of weeks in a bid to maintain personal hygiene and observe social distancing. Not only these companies remain unperturbed by the supply chain disturbance, Fed’s emergency rate cut and the monetary stimulus but are also performing well in the current volatile environment.

Although the U.S. stock markets didn’t quite respond to the central bank’s stimulus measures, the companies that are mostly offering necessary goods, such as food products or operating in the technology space, demonstrated a strong resilience.

For example, companies like Zoom Video Communications, Inc. (ZM - Free Report) , which offer video-first communications, such as work collaboration and video conferencing tools, could be up for grabs as more people stay indoors to work remotely.

In addition, the lockdown of schools and universities across the states for indefinite periods could drive online education stocks. Companies, namely Instructure, Inc. , which offers applications for learning, assessment and performance management through a software-as-a-service business model, could be in the forefront for performing better as online courses gain a momentum among students studying from their residences.

4 Stocks to Buy

We have, therefore, rounded up four stocks that offer consumer staples products or are under the umbrella of stay-at home technology stocks. All of these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Campbell Soup Company (CPB - Free Report) is a manufacturer and marketer of food and beverage products. The Zacks Consensus Estimate for Campbell Soup’s current-year earnings has moved 2.8% north in the past 60 days. This Zacks Food - Miscellaneous industry company’s expected earnings growth rate for the next quarter is 28.6%.

Blue Apron Holdings, Inc. (APRN - Free Report) is the operator of a direct-to-consumer platform which delivers original recipes and fresh and seasonal ingredients. This Zacks Consensus Estimate for Blue Apron’s next-year earnings has moved 5% north in the past 60 days. The Zacks Food - Miscellaneous industry company’s expected earnings growth rate for the current year is 4.3%.

The Zacks Consensus Estimate for Zoom Video Communications’ current-year earnings has moved 51.9% north in the past 60 days. This Zacks Internet - Software industry company’s expected earnings growth rate for the next quarter is 37.5%.

The Zacks Internet - Software industry company Instructure’s expected earnings growth rate for the next quarter is 12.5%.

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