This list of pandemic-resistant investments and one index are good long-term considerations to bolster your portfolio, even after the chaos dies down.
Without a doubt, the stock market’s recent volatility can make even the most seasoned investors question their choices. We present you with these five instruments that withstood the calamity of the pandemic selloff to strengthen your portfolio and provide long-term growth.
1. S&P 500
The S&P 500 (NYSEARCA: VOO) is a stock market index of 500 large-cap U.S. companies meeting a set of criteria like having a market cap of over $8.2 billion. It is considered the benchmark of the overall market by investors. Historically, the index has provided an annual average return of nearly 10% since 1928, even through times of great turmoil like Black Monday, 9/11, the dot com bubble burst, and the 2008 crash.
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As of June 8, the index erased all of its losses from the pandemic sell-off. The best way to invest in this instrument is in the form of an ETF like Vanguard’s S&P 500. Patient long-term investors have profited and will continue to profit from the ever-optimistic index.
Microsoft (NASDAQ: MSFT) is the trillion-dollar software company that made its mark on the world by having a first-mover advantage for operating systems and software for personal and business computers. As computers became cheaper and the internet grew in popularity, Microsoft’s revenues grew by leaps and bounds.
Windows has a 77% global market share and the company’s cloud platform, Azure, has a 15.5% share and is the second-most-popular in the world. The pandemic has benefited the company by giving it a 59% boost in cloud sales and analysts expect Azure to overtake Amazon’s (NASDAQ: AMZN) AWS in the near future. Additionally, the new XBOX is due out before the holiday season, assuring continued revenue growth.
3. Johnson & Johnson
Johnson & Johnson (NYSE: JNJ) reported an EPS of $2.30 for Q1, beating estimates by $0.27 and revenue of $20.69 billion, beating the $19.48 billion expectations; furthermore, the Dividend Aristocrat (BATS: NOBL) boosted its rate by 6.3% to $1.01 per share, a 2.81% yield. Although J&J incurred $5 billion dollars in legal fees in 2019 for litigation against it for asbestos in its talcum powder and its contribution to the U.S. opioid epidemic, analysts are still confident in the company’s strength and growth.
Its medical device sales declined in the last quarter but its sales for pharmaceuticals and consumer health products soared; Tylenol sales alone grew 35% from rumors that it was less dangerous than ibuprofen during the pandemic. J&J’s diverse range of healthcare products will serve investors and the growing aging demographic (20% of all Americans will be 65 or older by 2030) as revenues will continue to rise.
Amazon is another trillion-dollar company and is the largest e-commerce retailer in the U.S, with a nearly 39% market share, as well as the most popular option for cloud services with its AWS offering, holding over 32% of the U.S. market. The company also has irons in the OTT, smart-speaker, pharmaceuticals, and grocery fires and has grown its Prime subscription to 118 million members in the U.S. alone.
The pandemic helped boost revenues for Amazon on two fronts: e-commerce and cloud services as more people shopped and worked from home and the company reported revenues of $75.45 billion in its last quarterly, beating estimates by $1.84 billion. This diverse organization is expected to continue to profit as there is a resurgence of the pathogen in the U.S.; additionally, its 70% U.S. market share in the smart speaker market and the growing aging population will continue to boost earnings in its pharmaceutical division.
Walmart (NYSE: WMT) is the largest brick-and-mortar retailer and the second largest e-commerce merchant in the U.S. The company saw a boost to its grocery and e-commerce sales of 74% in the last quarter and had to grow its workforce by 235,000 new hires. Its price-matching policy helps it retain a loyal consumer base that was no-doubt affected by record unemployment numbers from the recent pandemonium and its huge logistics infrastructure helps the company compete with Amazon by keeping shipping costs to a minimum. Thanks to the resurgence, there is little doubt that the company will continue to prosper and its e-commerce division will grow not only thanks to innovative CEO Marc Lore, but also its global expansion with acquisitions like FlipKart.
MyWallSt operates a full disclosure policy. MyWallSt staff currently hold long positions in companies mentioned above. Read our full disclosure policy here.