There is a feeding frenzy over pandemic stocks. These are health care and technology companies that offer solutions for the current crisis.
Zoom Video Communications Inc. (Nasdaq: ZM) offers an easy-to-use video platform for people during the lockdown. And the stock more than doubled from where it started this year … before crashing back down.
The fast-growing tech company is now facing backlash over security concerns.
Many of these highfliers will face similar issues. Once-promising medications may prove less effective than thought. Or demand could drop off once the outbreak is contained.
But there is another group of essential stocks that investors are overlooking.
These are companies that run the most basic services. And no matter where people work or how the economy performs, demand will hold up. We can’t live without them.
Last August, I told readers about a group of stocks that were beating the S&P 500 Index. These stocks returned twice what the S&P 500 did.
But they are so obvious that investors overlook them every single day. These essential stocks provide the electricity, internet and cell service we use daily. They even clean up after us.
Here’s the original list I used as an example:
- The Progressive Corp. (NYSE: PGR) for insurance.
- NextEra Energy Inc. (NYSE: NEE) for power.
- Waste Management Inc. (NYSE: WM) for disposal.
- Comcast Corp. (Nasdaq: CMCSA) for internet.
- AT&T Inc. (NYSE: T) for phone services.
These names may look different depending on where you live and which service you choose. But as a customer, you’ve already done half of your research. You know the quality of the product.
The next step is just checking the balance sheet or the last quarterly filing.
With markets in a panic, these essential services offer a great safe haven. But many of these stocks are trading at better values after the crash. That means it is a great time to add them to your portfolio.
This weekend, flip through your bills to see which services you can’t live without — and buy them up while they’re cheap!
Managing Editorial Analyst, Banyan Hill Publishing
P.S. Check out my latest Marijuana Market Update below. I follow up on three American cannabis operators. Two of them hold a lot of promise. But I also issue a warning about another that has fallen more than 85% in recent months.