Investing

40 Solid Stocks Thriving Through the COVID-19 Recession

Citrix Systems
> YTD Gain: 32%

Citrix Systems Inc. (NASDAQ: CTXS) hit an all-time high in May of 2020 due to workspace services, mobility and device management, networking products, managed desktops, cloud and storage, security and other software and app services. It’s as if Citrix was positioned perfectly for a workforce that was going to be sent home and still eventually would come back to work.

Clorox
> YTD Gain: 33%

Clorox Co. (NYSE: CLX) has lived up to being a defensive stock while most other consumer products stocks have either not performed well or are suffering. The driver for Clorox is of course the cleaning and bleaching aspect, wipes and other related products that are still in many cases harder to find than basic consumer products. That said, even today their products are still not meant to be inhaled, consumed or ingested in any form.

Costco
> YTD Gain: 5%

Costco Wholesale Corp. (NASDAQ: COST) proved that the hoarders were buying up everything with a large wave of sales gains initially. Those sales then began to soften as their traditional products were overwhelming the creature comfort items with far higher prices left untouched on the warehouse floors. Costco also has a higher average income customer that may be at least a bit more insulated than lower income groups. Costco remains valued at a large premium for its growth and execution, but investors buying in to Costco’s 787 warehouse locations today are really looking out for when it has 1,200 or more locations globally. It also raised its dividend after the recession had started.

Datadog
> YTD Gain: 80%

Datadog Inc. (NASDAQ: DDOG) hit a post-IPO high in May, as revenues were up 87% from a year earlier. Large customers (over $100K in spending) rose to 960 from 508 in early 2019, and the company launched its security monitoring service to break down walls separating security, development and operations. Valuations are not for the faint of heart here, but that’s the price for projecting better than 50% revenue growth while inside of the eye of the recession.

Digital Realty
> YTD Gain: 11%

Digital Realty Trust Inc. (NYSE: DLR) is a leader in hosting and colocation services. As a real estate investment trust (REIT), it is effectively the landlord of the cloud. It also sports a 3% dividend yield, and its acquisition of InterXion will help Digital Realty grow internationally as foreign companies also look to decentralize their data and storage by hosting on the cloud. Its rival in the cloud, Equinix Inc. (NASDAQ: EQIX), deserves an honorable mention here for growth and investor returns, as do other competitors.

DocuSign
> YTD Gain: 60%

DocuSign Inc. (NASDAQ: DOCU) hit its post-IPO all-time high as well, and the remote signature application provider has managed to do this despite real estate slowing down sharply. The reality is that anyone using DocuSign is amazed at how fast and efficient the service is. As with many software and app-based players, valuations are not for the timid, as revenue growth is expected to remain above 25% despite the recession.

Dollar General
> YTD Gain: 16%

Dollar General Corp. (NYSE: DG) is the king of the dollar store theme, and it was adding jobs while others were cutting them. It also has moved into the “reach-up” price points well above $1.00. It sells many food and private label items used by the public and in many smaller communities. It is the sole supplier that is a national chain. Its stock has risen so much that at all-time highs it now barely has a 0.8% dividend yield. It also has more than 16,000 stores around the nation.

Domino’s Pizza
> YTD Gain: 29%

Domino’s Pizza Inc. (NYSE: DPZ) has managed to come of age to the point that it has been announced to join the S&P 500 after its earnings report was behind it. Millions of Americans already had its app or online ordering before COVID-19 sent everyone home, but it soared during the scare and is likely to remain popular. On top of dominating pizza delivery, Domino’s has been adding many other food items to its menu that come with high margins as well: chicken wings, sandwiches, pasta and desserts. Papa John’s International Inc. (NASDAQ: PZZA) should get an honorable mention, with its shares up 27% year to date and seeing similar gains domestically.