Zoom, Docusign, Okta: Work From Home Stocks Poised For Further Gains?
The Covid-19 pandemic has forced people to increasingly work and learn from home, causing surging demand for software focused on connectivity, collaboration, and cybersecurity. Our indicative theme on Work And Learn From Home Stocks is up by 178% year-to-date, compared to a 5.2% return for the S&P 500. While valuations appear high for many of these stocks, it’s quite possible that the pandemic will cause a structural shift, benefiting these companies over the longer-term as well. Zoom (NASDAQ: ZM) has been the biggest driver of the theme’s returns, rising by over 460% year-to-date. On the other side, Slack’s (NYSE: WORK) performance has been more muted, with the stock gaining about 15% this year. Below is a bit more about the companies in our theme.
Zoom emerged as the video conferencing platform of choice through the pandemic, thanks to its easy user interface and simple sign-up process. The stock has gained about 460% year-to-date.
DocuSign offers e-signature solutions that enable companies to sign and manage contracts and agreements digitally, avoiding a time consuming and inefficient manual process. The stock has gained 175% year-to-date.
CrowdStrike is a cybersecurity player that offers a cloud-delivered endpoint protection platform, which relies on a lightweight software running on the customer’s servers or laptops. The stock is up by 150% this year.
Okta is a cloud security company that provides identity and access management tools that enable users to securely access cloud-based applications from various devices. The stock has gained about 70% this year.
Slack Technologies is best known for its collaboration platform that is positioned as an alternative to email. The stock is up by about 15% year-to-date.
What if you’re looking for a more balanced portfolio instead? Here’s a top-quality portfolio to outperform the market, with over 100% return since 2016, versus 55% for the S&P 500, Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk. It has outperformed the broader market year after year, consistently.
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