When the curtain finally closes on 2020, it will certainly go down as one of the most volatile years on record for Wall Street and investors. The uncertainty created by the Coronavirus Disease 2019 (COVID-19) epidemic initially sent the benchmark S&P 500 34% less during the first quarter. This was followed by the strongest snap-back rally of all time, in which the broad-based S&P 500 climbed to new heights in less than five months.
But just because the stock market has picked up in six months does not mean that the volatility has gone away.
Last Thursday’s market downturn, which lost nearly 126 points to the S&P 500, ranked it as the eighth largest single-day slump in history. Of course, keep in mind that the 3.5% percent decline is not close to registering as one of the worst days for the stock market. This move, however, sends a clear message that too much economic uncertainty persists, and a stock market crash can occur without warning.
Although stock market crashes may be unnecessary in a very short period of time, they are actually fantastic news for long-term investors with dry powder. This is because every single stock market correction in history has finally been wiped out by a bull market rally. If investors want to choose high quality companies during the stock market journey, they usually outperform in the long term.
While it is a little early to tell if last week’s unrest will turn into anything after a full correction, here are three great stocks to consider when the stock market crashes.
Get the stick ready, because it’s time to beat the drums on the telemedicine giant Teldok Health (NYSE: TDOC), once again.
The beauty of healthcare stocks is that, even if they are caught in an emotional whirlpool that crashes the stock market, the demand for their products and services is not substantially reduced. Since we do not get to choose when we are sick or what disease (illness) we develop, the cash flow for healthcare companies is very stable, no matter what is happening with the stock market.
More specific to Taildock, it is seeing an incredible build in demand for virtual health trips. Yes, COVID-19 has played an important role in TallDoc’s 2020 growth, up 203% to 2.8 million during the June-ended quarter. But it is not that the taildock did not grow like a weed before the coronavirus epidemic changed our way of life. Pushing Teldoc’s revenue from convenience and precision medicine increased from $ 20 million in 2013 to $ 553 million in 2019, until COVID-19 was declared an epidemic.
Telemedicine is an important component of the future of precision medicine. This frees up more time for patient-doctor consultation, provides consultation flexibility for both parties, and is actually cheaper for insurers than office visits. When we’re not going to see in-person trips to the doctor, the runway is in a big way for virtual visits, and the taildock is still scratching the tip of the iceberg about its potential.
As a final note, Teladoc is in the process of merging with the applicable health signals provider Livongo Health (NASDAQ: LVGO) In a cash and stock deal. Livongo uses mountains of patient data and artificial intelligence to send suggestions and elbows to patients with chronic disease to help them make lasting behavioral changes. It is doing amazing work for the company’s diabetic members, and Livongo has already turned to profit despite having only a 1.2% share of the American diabetes market. When fully merged, this company is going to be a precision pharmaceutical powerhouse.
For more conservative investors, who are not keen on the short-term volatility that TelDoc will bring to the table, suggest me to buy in Telecom Beehome AT&T (NYSE: T).
When you think of a basic need good or service, the idea of buying food, water or paying for electricity or natural gas probably comes to mind. But how about our dependence on mobile phones? As technology has improved, the penetration of smartphones and wireless technology has declined, making mobile phones a basic need service for many adults in this country. With AT & T’s business model primarily based on subscription, a stock market crash is unlikely to have an impact on its wireless network subscriber count, if any.
Apart from the note, AT&T is upgrading its first wireless infrastructure in nearly a decade. The move to a 5G network is not going to happen overnight, nor will consumers upgrade their wireless devices at once. However, this investment in faster download speeds is bound to create a multiyear tech upgrade cycle that will fuel the high-margin data component of AT & T’s wireless segment.
Investors should not ignore the company’s streaming opportunity. AT&T counted on its streaming offerings, HBO Max, and proprietary networks (TNT, TBS and CNN) to continue to haemorrhage subscribers due to cord-cutting with subsidiary DirecTV to help customers pay Has been Management aims to essentially double HBO Max and HBO (on a joint basis) by 2025 worldwide.
Best of all, patient investors are going to get a 7% dividend yield with AT&T, one of the highest, safest yields you’ll get. If volatility calms your stomach, AT&T is a great stock to park your cash on.
Another wise idea is to buy into the payment facility when the stock market crashes. Visa (NYSE: V).
As you can imagine, the COVID-19 epidemic has hurt consumer spending and thrown the US economy into its first recession in 11 years. This is bound to reduce the amount of money that consumers are spending, ultimately hurting merchant fees that payers like Visa facilitates.
But here is another way to think about this data. During the Great Recession, Visa saw only a year-over-year decline (2009) in terms of the gross dollar value that its payment network was receiving. Between 2009 and 2018, Visa’s share of the US credit card market grew by 53%, with purchases up to 53% over 53%, and purchases more than doubled from $ 764 billion to $ 1.96 trillion on its network. happened. Visa is the preferred payment processor in the world’s No. 1 economy, dependent on consumption only.
Visa also serves as a fully cashless payment facility. While some of its processing partners act as lenders, Visa does not lend money. This may seem like a poor option that allows the ability to double on revenue streams during periods of economic expansion. However, this means that Visa is not directly exposed to credit delays during the inevitable period of economic contraction or recession. With no need to separate the loan-loss provisions, Visa’s profit margin is 50% or more.
Also, Visa has a ridiculously long runway with which to hike. Most of the world’s transactions are still being operated in cash, providing a great opportunity for new traders to appear in court and wage a war on cash in underbanked regions such as the Middle East and Africa.
If the stock market crashes, Visa is a great stock to consider when buying.