COVID-19 VACCINE Update: 3 Stocks That CRASHED

A COVID-19 vaccine could be imminent! Is it time to consider selling these stocks that have already started to drop?

| More on:
Coronavirus written newspaper close up shot to the text.

Image source: Getty Images

People around the world had a few major events this weekend. The world was introduced to the next president-elect when Joe Biden won the United States election. But there’s even bigger news that came out, with a new COVID-19 vaccine potentially coming available in the new year.

The vaccine could potentially be 90% effective. While it’s unclear when it could be available, and to Canadians in particular, it sent investors into a flurry. A COVID-19 vaccine could mean a return to normalcy. While many stocks soared at the news, there were a few that sunk. While the news is great for everyone, those able to take advantage of a work-from-home economy might see a shrink in revenue.

This could be the reason behind a slump from companies like Shopify (TSX:SHOP)(NYSE:SHOP), Goodfood Market (TSX:FOOD) and CloudMD Software & Services (TSXV:DOC).

Shopify

Canadian e-commerce giant Shopify has had a banger year. The company was already soaring before the pandemic. However, after a brief drop in share price, the company just kept growing and growing in share price. Even analysts who predicted a crash in share price to around $200 had to up that amount. It looks like the triple-digit days are behind this company.

However, shares in Shopify stock sunk by about 15% from the COVID-19 vaccine news. While many businesses have moved more business online, it’s likely that there will be a shrink in subscription revenue moving forward. However, let’s not forget the company hasn’t had problem with revenue before. In fact, most recently that revenue hit a year-over-year increase of 74%!

And while it might not be that high in the future, it could very well continue in those high double digits for some time to come. In fact, this could be the chance to buy up this booming stock before the next share price jump — especially with more enterprise clients coming on all the time.

Goodfood

Another company that saw a boost in subscriptions is the meal-kit industry. As Canada’s top meal-kit delivery service Goodfood has seen its shares double during the crisis. But with people looking to the future and potentially not needing the service anymore, shares sunk by about 18% with the news of a COVID-19 vaccine.

But again, Goodfood wasn’t born out of a work-from-home economy. It’s part of a multi-billion-dollar industry that is still in its infancy. In fact, with a market cap of $542 million as of writing, it still has plenty of room to grow to reach its peers across the world. Revenue was up another amazing 79% year over year during the recent quarter, and it’s very likely this will continue to grow, as more people move towards meal-kit delivery, pandemic or not.

CloudMD

Finally, CloudMD provided a service that was pretty much essential during the pandemic. Instead of going to a doctor, a doctor could come to you. Virtually, that is. Not just physicians but residents, physiotherapists, mental health experts; everything you need for healthcare. The company has been acquiring virtual businesses ever since, with an annual return of 595% as of writing.

Yet this company, too, saw a drop with a COVID-19 vaccine. That’s because people think they might actually return to the doctor after this is over. But will they? It’s far more convenient to ask a simple question of a doctor within minutes from a variety of experts from your home. And it’s safer for everyone involved. So, it’s likely the company will continue to grow for years to come.

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 Amy Legate-Wolfe owns shares of Goodfood Market and Shopify. Tom Gardner owns shares of Shopify. The Motley Fool owns shares of and recommends Shopify and Shopify. The Motley Fool recommends Goodfood Market.

More on Coronavirus

A airplane sits on a runway.
Coronavirus

3 Things to Know About Air Canada Stock Before You Buy

Air Canada stock continues to hover below $20 despite the sharp rise in travel demand seen across the industry. What's…

Read more »

tech and analysis
Stocks for Beginners

If You Invested $1,000 in WELL Health in 2019, Here is What It’s Worth Now

WELL stock (TSX:WELL) has fallen pretty dramatically from all-time highs, but what if you bought just before the rise? Should…

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Coronavirus

2 Pandemic Stocks That Are Still Rising, and 1 Offering a Major Deal

There are some pandemic stocks that crashed and burned, while others have made a massive comeback. And this one stock…

Read more »

Dad and son having fun outdoor. Healthy living concept
Dividend Stocks

1 Growth Stock Down 15.8% to Buy Right Now

A growth stock is well-positioned to resume its upward momentum in 2024 following its strong financial results and business momentum.

Read more »

Double exposure of a businessman and stairs - Business Success Concept
Stocks for Beginners

3 Things About Couche-Tard Stock Every Smart Investor Knows

Couche-tard stock (TSX:ATD) may be up 30% this year, but look at the leadership and history of the stock to…

Read more »

Plane on runway, aircraft
Coronavirus

Can Air Canada Double in 5 Years? Here’s What it Would Take

Air Canada (TSX:AC) stock has gone nowhere since 2020. Can this change?

Read more »

Senior housing
Stocks for Beginners

Home Improvement Stocks Are Set to Fall (When They Do, Buy These Like Crazy!)

Home improvement stocks are due to drop further in the coming months. But with solid underpinnings for the sector, it…

Read more »

An airplane on a runway
Coronavirus

Forget Boeing: Buy This Magnificent Airline Stock Instead

Boeing (NYSE:BA) stock is looking risky right now, but Air Canada (TSX:AC) stock? Much less so.

Read more »