If you thought the coronavirus crisis on Wall Street couldn’t get any worse after Wednesday — surprise! — it just did. Markets that were merely shaky earlier in the day on Thursday ended in a rout in the closing minutes of trading. When the closing bells rang, the Dow Jones Industrial Average and the S&P 500 were both down 4.4%, and the Nasdaq had fallen 4.6%.
In percentage terms, this was the eighth biggest drop in the Dow in history. By “points” lost, however, it was Wall Street’s worst day ever.
And yet, even on this arguably worst day in recorded Dow history, three tech stocks managed to buck the tide. As stocks fell left and right around them, shares of fintech stock Square (NYSE: SQ) closed the day up 3.6%; remote videoconferencer Zoom Video (NASDAQ: ZM) closed up 6.2%; and online freelance work-finder Upwork (NASDAQ: UPWK) closed up 7.3%.
What made these three stocks defy the downtrend? Each company had its own specific reasons for showing strength yesterday.
In the case of Zoom, for example, analysts at Bernstein in a note today observed that “average daily downloads” of Zoom’s app “are up 90% … in the last 30 days alone,” compared to last month, and “user engagement” is up, as well. So far this year, Zoom has added more new users than it did in all of 2019.
At Upwork and Square, meanwhile, it was earnings that drove stock gains.
Upwork reported positive profits in Q4 ($0.03 per share) versus the loss Wall Street had anticipated. Upwork also beat on sales in the quarter. Even with the company guiding to lower revenues than analysts had predicted in the year ahead, Upwork’s news stood in such stark contrast to what everyone else has been saying lately that the stock really couldn’t help but go up.
Square said it earned $0.83 per share last quarter, which appears to be far more than the $0.21 per share that Wall Street was expecting (although TheFly.com points out that Square’s numbers “may not be comparable” to Wall Street’s consensus). Like Zoom, Square guided cautiously on the year ahead, but its first-quarter 2020 guidance, at least — $0.16 to $0.18 per share in profit — appears likely to beat Street expectations for $0.16.
As businesses build on the idea of permitting workers to interact remotely — in contrast to close enough for person-to-person transmission of the coronavirus — both Upwork and Zoom appear well-positioned to not just survive, but also potentially thrive in this current health crisis. Square, which is tied more to in-person sales transactions, may yet see its sales slide if the contagion worsens. For the time being, however, let’s just be pleased with its Q4 performance.
In fact, on a day like yesterday, let’s just be happy that any company is still doing well.