A COVID-19 Vaccine Could Be a Reality Soon: Where to Invest $3,000 Right Now

Stocks or sectors hit hard by the pandemic could recover fast and deliver solid returns.

| More on:

While it’s unclear when we can expect a vaccine against the novel coronavirus, the big pharma companies’ relentless efforts worldwide suggest that it could hit the markets soon. Yesterday, Pfizer announced that its vaccine candidate showed promising results in the late-stage trials, giving a significant boost to the stock market. 

As we get closer to a vaccine, stocks or sectors hit hard by the pandemic could recover fast, thus providing opportunities for investors to gain big from the recovery. So, if you’ve got $3,000 to invest, consider buying these stocks while they are still low. 

Recipe Unlimited 

Recipe Unlimited (TSX:RECP) stock was hit hard, as mandated restaurant closures amid the pandemic took a toll on its sales and profitability. While the unlocking measures drove meaningful growth in its top line on a quarter-over-quarter basis, its system sales plunged 22.2% year over year in the most recent quarter, reflecting the negative impact of the COVID-19 pandemic. 

However, a COVID-9 vaccine means Recipe Unlimited’s corporate and franchise restaurants could recover fast and deliver strong growth. Meanwhile, sustained momentum in its off-premise system sales could further accelerate its growth and lift its stock higher. 

Its off-premise system sales increased by 40.8% in Q3, reflecting a 23.9% jump in orders. Moreover, the trend in off-premise sales is expected to sustain in the coming years, thanks to its multiple delivery options and established tech platforms. Recipe stock is down about 15% year to date, despite the 12% jump on Monday and offers an excellent entry point. 

Bank of Nova Scotia

Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) is another TSX stock that should be on your radar for a post-pandemic world. A COVID-19 vaccine could lead to an uptick in loans and deposits volumes and drive a significant decline in the provisions for credit losses. 

With an expected decline in provisions and continued momentum in its personal and commercial banking and wealth management segment, Bank of Nova Scotia’s bottom line could show substantial growth, which could drive its stock higher. 

Further, investors are expected to benefit from Bank of Nova Scotia’s robust dividend payments. Bank of Nova Scotia offers a dividend yield of over 6%, which is safe and is likely to boost your overall returns.  

Air Canada

Air Canada (TSX:AC) stock could be one of the key beneficiaries of the COVID-19 vaccine. Air Canada’s passenger volumes took a significant hit amid the pandemic-led travel restrictions. While its revenues plunged, net cash burn spiked, leading to large losses. 

However, the reopening of the economy and restart of domestic operations helped Air Canada to report healthy sequential improvement across all parametres in Q3. Its net cash burn declined significantly on a quarter-over-quarter basis. Meanwhile, capacity and passenger load factors also improved. 

Investors should note that a vaccine against the COVID-19 pandemic is likely to significantly boost the prospects of the airline stocks, including Air Canada. The airline company’s passenger volumes, net cash burn, and the bottom line are likely to show sharp improvement with people returning to the sky. Meanwhile, investors could benefit significantly from the recovery in its stock. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends BANK OF NOVA SCOTIA.

More on Dividend Stocks

money goes up and down in balance
Dividend Stocks

This 6% Dividend Stock Is My Top Pick for Immediate Income

This Canadian stock has resilient business model, solid dividend payment and growth history, and a well-protected yield of over 6%.

Read more »

ways to boost income
Dividend Stocks

1 Excellent TSX Dividend Stock, Down 25%, to Buy and Hold for the Long Term

Down 25% from all-time highs, Tourmaline Oil is a TSX dividend stock that offers you a tasty yield of 5%…

Read more »

Start line on the highway
Dividend Stocks

1 Incredibly Cheap Canadian Dividend-Growth Stock to Buy Now and Hold for Decades

CN Rail (TSX:CNR) stock is incredibly cheap, but should investors join insiders by buying the dip?

Read more »

bulb idea thinking
Dividend Stocks

Down 13%, This Magnificent Dividend Stock Is a Screaming Buy

Sometimes, a moderately discounted, safe dividend stock is better than heavily discounted stock, offering an unsustainably high yield.

Read more »

Canadian Dollars bills
Dividend Stocks

Invest $15,000 in This Dividend Stock, Create $5,710.08 in Passive Income

This dividend stock is the perfect option if you're an investor looking for growth, as well as passive income through…

Read more »

A Canada Pension Plan Statement of Contributions with a 100 dollar banknote and dollar coins.
Dividend Stocks

3 Compelling Reasons to Delay Taking CPP Benefits Until Age 70

You don't need to take CPP early if you are receiving large dividend payments from Fortis Inc (TSX:FTS) stock.

Read more »

A worker overlooks an oil refinery plant.
Dividend Stocks

Better Dividend Stock: TC Energy vs. Enbridge

TC Energy and Enbridge have enjoyed big rallies in 2024. Is one stock still cheap?

Read more »

Concept of multiple streams of income
Dividend Stocks

Got $10,000? Buy This Dividend Stock for $4,992.40 in Total Passive Income

Want almost $5,000 in annual passive income? Then you need a company bound for even more growth, with a dividend…

Read more »