Omicron: 3 Stocks That Will Still Thrive

The Omicron variant is shaking the world but Cargojet Inc (TSX:CJT) is safe from the contagion.

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We’re approaching the end of November, and the Omicron variant is here. While last week’s panic calmed down over the weekend, there is still some concern about the new COVID-19 variant. It’s looking like Omicron may be significantly less lethal than previous variants of COVID, but may also be more transmissible. Scientists aren’t sure what we’re dealing with here, so nations of the world are playing it safe and imposing travel bans.

As long as travel bans are part of the conversation, then industries like travel and lodging are going to be hit hard. But there are other industries that can handle the worst COVID can throw at them. Industries that not only survived but also thrived during the pandemic’s initial outbreak. In this article, I will explore three such companies whose stocks could do fine amid the Omicron outbreak.

Cargojet

Cargojet (TSX:CJT) is a passenger airline that ships packages for e-commerce companies. Any time you order something online, there is a good chance that CJT or a similar company is shipping it to you. CJT stock fared pretty well in the first COVID-19 outbreak. In the second quarter, it grew its revenue by 65% year over year. The COVID-19 pandemic forced many retail stores to close, resulting in a surge in e-commerce shopping. This in turn led to a jump in sales for companies like Cargojet, which were tasked with flying the orders out to their destinations.

Shopify

Shopify (TSX:SHOP)(NYSE:SHOP) is a Canadian e-commerce company that fared extremely well in 2020. The COVID-era retail store closures led to Shopify posting four consecutive quarters of growth above 90%. Since then, the company’s growth has decelerated down to 46%, which is still very strong. The thesis for investing in SHOP was pretty much intact even with that deceleration.

Everybody knows that it’s harder to produce strong growth compared to a strong base period. It was priced in. But now, with Omicron making an appearance, there’s a possibility that Shopify’s most favourable catalyst (retail closures) will return. If that ends up being the case, we could see a 90% growth return once more.

Wal-Mart

Last but not least we have Wal-Mart (NYSE:WMT). As you probably know, it’s a U.S. retail giant that sells low-priced goods like groceries, clothing, and electronics. Wal-Mart was one of the few traditional retailers that did well in 2020. Its sales grew 6.7% to $559 billion.

As an essential service company selling groceries and medication, Wal-Mart was able to keep most of its stores open throughout the pandemic. If lockdowns were to resume again, then Wal-Mart would likely thrive, as its products are vital to peoples’ day-to-day lives. It also has a growing e-commerce presence. This is a stock that could do well in the event of Omicron-inspired lockdowns.

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 Andrew Button has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends CARGOJET INC. and Shopify.

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