10 Very Strong Stocks Thriving in a Very Crummy Stock Market
The stock market in 2020 has gone from a raging bull market to panic mode in very short order. The impact of the coronavirus dealt a knockout blow to China. It has spread around Asia and into Europe (and most countries) and is now posing a major threat to the United States. The United States already is feeling the economic pinch as the number of coronavirus cases rises. Consumers are canceling flights and hotel bookings, and they are stockpiling certain goods. Companies are canceling major conferences, restricting employee travel and even turning to work-from-home efforts. The S&P 500 had risen handily in 2020 for a peak gain of 5% as recently as February 19, 2020, but now the market is over 8% lower year to date and down 12.4% from the peak.
The volatility in the past two weeks alone has turned even most of the biggest bulls into timid cows. Some investors are now worried that the bull market is dead and that the coronavirus outbreak will send the U.S. economy into stagnation or perhaps even into a recession. While a falling stock market is often bad for most stocks, even the crummiest of stock markets can still produce some serious winners. It turns out that many stocks have risen handily even through the carnage in 2020. Some stocks have performed so well that investors should wonder how well they could have performed had the stock market remained firm.
24/7 Wall St. has screened for stocks that have been performing well on a one-week, one-month and year-to-date basis. Many of these companies are rather well known by the investing community and the public alike. While no logical investor can reasonably expect a stock to rise forever or stay up if the market continues decides to go from bad to worse, screening criteria were used in looking for the top stocks in this crummy stock market.
Small-cap stocks were screened out, with a $3 billion market cap level used as a general floor. The very speculative stocks that have seen exponential growth due solely to their claims or efforts tied to the coronavirus were also screened out. Many of these companies have been around for many years, and some are profitable and even pay dividends. We even have looked at both sides of the coin to identify whether lurking risks or valuation concerns need to be considered.
Here are the 10 stocks that have incredibly strong stock charts and strong performance despite the crummy market conditions that have been seen so far in 2020. A chart montage was also provided at the end of this article.
Campbell Soup Co. (NYSE: CPB) had been ticking along like a steady heartbeat in most of 2020, and despite selling off toward the end of February, its earnings became more than enough of a catalyst to send shares higher with its quarterly report and stronger 2020 guidance. Some investors are treating Campbell Soup as a coronavirus pick due to people buying up canned and prepackaged foods, while some could argue it was finally time for the food to giant to win. With a market cap of about $15.8 billion, Campbell Soup was up about 14.7% over the past week, but it was up “only” about 5.6% in the past month and about 4.7% year to date. This company’s checkered past performance will have some investors on edge, but any breakouts above $53 don’t have any resistance on the five-year charts up to $57 and $60 or so.
Cogent Communications Holdings Inc. (NASDAQ: CCOI) seems to be in the sweet spot for small and midsized businesses by offering high-speed fiber internet access, as well as private networks and data center colocation space. It is up over 1,000% since 2010, but its $4 billion market cap is not high enough that analysts or investors would say it has no room for growth. That said, it has high multiples at about 87 times expected 2020 earnings and close to seven times expected sales. It also has been growing, with its 3% dividend yield and a blend of income (46%) and return of capital (54%). Cogent shares were last seen trading up 19% in the past week, up over 21% in the past month and 32% higher year to date. Its performance has been strong enough that its shares are now higher than all the analyst targets.
Gilead Sciences Inc. (NASDAQ: GILD) has several things going for the company at once. One is actually the coronavirus, as the company’s remdesivir is among the hopefuls as a treatment for the COVID-19. That has been a big driver, but Gilead was a sleeping value stock entering 2019, with low valuations and low expectations. The company also just announced a $4.9 billion acquisition of a company called Forty Seven Inc. (NASDAQ: FTSV) in immuno-oncology to boost its cancer ambitions.
Gilead has been dead money for a long time and had been among the targeted companies under the political/social criticisms for high-priced drugs targeting hepatitis and HIV/AIDS in past years. There is some risk here, if remdesivir is not a widely accepted treatment ahead, but that remains to be seen. Its shares were back above $80 on Friday and broke above the past $77 to $78 resistance level, and there is another overhang on the chart at $83 to $86 from 2017 and 2018. Gilead is up over 15% in the past week, almost 22% higher in the past month and up 23.5% year to date.
Iovance Biotherapeutics Inc. (NASDAQ: IOVA) is now worth $4.9 billion and is a cancer immunotherapy developer using novel T cell-based cancer immunotherapies. In mid-February, Iovance gave an update along with financial results that sent shares higher. The company’s tumor-infiltrating lymphocyte (TIL) is anticipated to be commercialized, and the company is building its internal manufacturing capability and expanding its own commercial team and infrastructure. The company expects its TIL to be the first potential cell therapy in solid tumors. On March 4, Barclays started coverage as Overweight with a $45 target price. On February 26, Oppenheimer (Outperform) raised its target to $35 from $32 and H.C. Wainwright (Buy) raised its target to $36 from $32. JMP issued a new Outperform rating with a $38 target at the end of 2019. After a $38.85 a share close on Friday, it would seem that those older calls either will have to get refreshed target prices or see valuation downgrades.
Iovance hit new highs on Friday, with shares up 18% in the past week, up about 64% over the past month and 40% higher so far in 2020 (and it’s up 283% over the past year).