Dr. Israel Figa Discusses the Best Investments to Make Post COVID-19

  • 4 weeks   ago

The coronavirus hit countries in the beginning of 2020 and since then, it has wreaked havoc on the world’s economy as a whole.

Nearly every industry suffered due to this unprecedented pandemic as countries had to be shut down to curtail the spread of the virus. Even though the COVID-19 pandemic is still not over, but many countries are of the general belief that the worst is finally behind us.

Economies all over the world are reopening slowly and most of the industries that suffered due to the pandemic are now moving on towards recovery. There were some sectors, such as leisure and travel, which too a huge hit in the pandemic. 

However, there were also some sectors that actually ended up benefiting in this crisis, such as streaming video, gaming and food delivery. The financial markets and global economy were impacted across the board and it seemed as if no industry had been spared.

Whether it is negative or positive, it is safe to say that almost every aspect of our lives will be changed forever because of the outbreak of COVID-19. Perhaps, the most significant change that we have seen has to do with remote employment. The latest trends in technology, such as hyperconnectivity, smart cities and mobility now have an addition; The Work-From-Home (WFH) Revolution.

Eight months of 2020 have gone by and these were 8 very devastating months for most of the world. Yet, it seems that the lockdown that had been implemented by a host of countries turned out to be successful. Most of the countries are now reportedly showing declining numbers of coronavirus patients and so, governments are lifting all lockdown measures that were imposed.

During this crisis, investors had been keen on finding value and identifying markets and segments that were benefitting or, stand to benefit in the future. 

Savvy investors are now trying to understand how different industries have changed because of the virus and are now looking for new investment trends that they can use for growing their portfolio. If you are doing so as well, Dr. Israel Figa sheds some light on the best investments that people can make post COVID-19:

The Gaming Industry

Passing the time during lockdown was immensely difficult for some people because they were stuck at home and didn’t really have much to do. The same cannot be said for video gamers. As per Israel Figa, most of these people are already used to playing video games for hours on end and simply got another opportunity to do so.

Furthermore, the gaming community undoubtedly saw an influx of new members in their community during the lockdown. In fact, even the World Health Organization (WHO) had recommended gaming as a way of passing the time. 

Experts like Dr. Figa state that even before the pandemic began, the gaming industry had been on the rise and now it has established itself as one of the most profitable sectors of entertainment, surpassing the film and music industries as well.

In the post coronavirus world, there are more gamers who became part of the community because of the lockdown and there is a good chance that many are going to stick to it. For instance, companies like Logitech saw their value shoot up by more than 33% since February 19th, 2020. These gains are partly because of the increase in EPS and also because the company also reported an increase in revenue. 

Similarly, Zynga, a popular casual game developer, also experienced an increase of 30% during the same time period. This was partly because of the partnership it has struck with Amazon, which is aimed at providing new content to Prime subscribers. Thus, Dr. Israel indicates that gaming is undeniably a popular investment theme. It is a booming industry and investors should go for it if they want a diversified investment strategy. 

eCommerce

While it is true that people were under a lockdown, but it certainly doesn’t mean that they had stopped shopping altogether. There are smartphones in every pocket and a number of online shopping options due to which it is not surprising that online commerce was hopping during the pandemic.

Today, online shopping provides you everything right at your fingertips, whether it is essentials you need, such as produce and dry foods, or you are after luxuries like electronics. Amazon is an excellent example of online shopping haven. During a time when its fellow tech companies were struggling to maintain and sustain their business, Amazon was struggling with how to fulfill demand. 

During a time when most companies in the United States were furloughing their employees, Amazon was actually hiring. As it is the largest ecommerce company in the world, the trillion-dollar giant could be regarded as a yardstick for the whole industry, which showed that it definitely benefitted from the lockdown.

Some other examples include that of Overstock, an online retailer, which also saw its value go up by a whopping 143% since February due to a great earnings report. Likewise, Wayfair, the furniture provider, also skyrocketed in the same period by almost 114%. 

These impressive numbers have prompted Dr. Israel Figa to add eCommerce as an excellent investment vehicle. People can invest in stocks of Amazon and Alibaba and even try out smaller players like Wayfair and Overstock. 

Food Delivery

A sub-section of eCommerce, online food delivery used to a niche, but thanks to the COVID-19 pandemic, it became the norm and is now a leading solution. During the crisis, millions of people all over the globe took advantage of the numerous online food delivery platforms for dining in and also for grocery shopping.

GPS technologies and contemporary smartphones have prompted the launch of courier services, which work in cooperation with restaurants. According to Dr. Israel Figa, Takeaway.com, Uber Eats, MeituanDianpig and GrubHubhave become go-to apps for those who wish to satisfy a specific culinary craving, but are unable to step out of their homes.

As per Dr. Figa, you can easily spot this in numerous stocks of this sector. There was an almost 188% increase in the value of Blue Apron, an online meal kit delivery service since February 19th, 2020. In addition, there was a 77.5% jump in value for UK-based grocery delivery giant known as Ocado.

Even though it might be regarded as a low-tech segment individually, food delivery has become reliant on technology nowadays and is certainly a part of the much larger foodtech industry. Thus, Israel Figa recommends investing in online food delivery because it represents the change in tastes and consumer behavior within the food industry. 

5G Technology

The COVID-19 pandemic was a major test of the ability of contemporary society to function remotely. From smartphone communication to social networking to video conferencing, the coronavirus pushed the internet to its limits. Furthermore, a huge number of companies all over the globe also leveraged remote work practices. As a matter of fact, Dr. Figa states that a number of these companies have claimed that they will maintain the same practices throughout 2020 and maybe, in the future as well. 

In effect, the coronavirus pandemic may have completely changed the way businesses operate permanently because it has helped normalize the concept of remote positions, which will require fully readjustment of remote practices. This is where 5G technology can play a vital role.

The next generation of wireless, high-speed communication is already being implemented and it is expected to bring a drastic improvement in nearly every aspect of digital communication, which includes helping more people work remotely. In less than four months, there has been a 40% increase in value of Marvell, which is a leading player in 5G technology. At the end of May, the company reported quarterly results that were better than expected.

Internet of Things (IoT), smartphone internet access, gaming and streaming video, along with driverless cars are just some of the technologies that will be enabled or improved by 5G. Israel Figa recommends that investors who are looking for options that can benefit them in the long-term should definitely give 5G another look because it can certainly bring them profits in the future, especially considering the fact that the new iPhones that will be launched this year are also rumored to have 5G technology. 

Biotechnology

When a pandemic strikes so fast and hard, it is only logical that giants of the biotech and pharma industries will attempt to rise up against it and put up a fight. According to Dr. Figa, the same is applicable in the case of COVID-19. Various companies all over the globe, from small startups to the largest pharma companies, began competing to develop a vaccine that could cure the virus or to find any other effective treatment for it. CRISPR is one of the scientific fields that are being explored for the possible solutions for the coronavirus. This is an advanced gene-editing method, which is said to be a potential cure for pretty much everything ranging from ALS to HIV. 

It is also being studied as a possible treatment for coronavirus. Regeneron, a biotech company that’s focused on CRISPR, saw an increase in its value by nearly 52% since February because it has managed to harness its velocisuitetechnology for tracking and recording the pandemic. This is a very novel technology and the biotech industry is very positive about its future and its potential. Dr. Figa believes that investing in companies that are studying and using this innovative technology could be very profitable in the future.

Cars

Dr. Israel Figa believes that the fear of getting infected in a public place is probably going to change consumer attitudes when it comes to using public transport for travel. They will prefer using their own cars and there has already been an increase in car sales. With that said, there will still be some issues with car sales because of overall economic conditions, along with employment troubles. In this regard, it makes a lot more sense to favor stocks that earn money through more miles being driven than by new vehicles being sold. For instance, auto parts retailers, such as Advance Auto Parts, AutoZone and O’Reilly Automotive are good options. 

These are able to make money when old vehicles are used more and will ultimately need servicing, something that’s going to happen as economic activity picks up. Moreover, with gasoline prices at an all-time low, Dr. Figa believes it will encourage drivers to increase their mileage and auto part retailers can also expect a positive outlook due to ongoing air travel restrictions as well. 

Factory Automation

There is already an existing trend related to the increased use of robotics and automation and Dr. Figa believes that the COVID-19 pandemic will only give it a boost. Not only can automation help in cutting down costs, but can also assist companies in avoiding some of the extended shutdowns that had been put in place by the government during the pandemic. Furthermore, the increased use of automation may make it a more viable option for industrial companies and they will be able to bring manufacturing back to the United States. 

This is probably the reason why industrial automation company Rockwell Automation, along with PTC, its industrial software partner, have managed to outperform the S&P500 as well as the industrial sector this year. 

 

Making an Investment Decision 

There is no denying that the equity markets took a significant tumble when the COVID-19 pandemic was at its peak. A number of global supply chains were brought to an abrupt and complete halt and the series of virus-related events inflicted a lot of damage on a plethora of companies out there. Nonetheless, the crisis has also managed to serve as a catalyst for the present as well as the future economic growth. 

Both financial institutions and private investors are now observing the current market conditions with the purpose of identifying segments that can actually show sustainable growth. According to Dr. Israel Figa, investors need to be very cautious when deciding their next investment post-coronavirus and the segments mentioned above are a good place to begin. 

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