Market Darlings- FAANG at the time of Coronavirus outbreak

As of 22 March 2020, the World Health Organization (WHO) has reported a total of 292,142 confirmed cases of coronavirus and 12,784 deaths from the pandemic. This figure includes 26,069 new cases of infection and 1,600 deaths.

Before the coronavirus pandemic, global economic growth was bleak though steady, as there were signs of recovery. However, this outbreak has emerged out as a significant source of disruption to the world economy.

Interesting Read: Coronavirus Crushes Hopes For Stronger Global Economic Growth

As economic outcome of the coronavirus outbreak in recent weeks has evolved dramatically with respect to its severity and duration, several economists, globally, are of the view that the global economy might experience an extraordinary contraction in the first half of 2020.

Recently, J.P Morgan economists have projected that the US economy would experience a contraction of 14% in the second quarter of 2020 after a contraction of 4% in Q1 2020. However, they expect it to recover to growth of 8% and 4% in Q3 and Q4, respectively.

Moreover, the shares of popular FAANG stocks have registered significant drop due to the COVID-19 outbreak.

Let us discuss these stocks’ recent performance along with recent updates pertaining to COVID-19.


Facebook (NASDAQ: FB)


The shares of Facebook have dropped considerably from US$223.23 on 29 January 2020 to ~ US$147 on 18 March 2020. The shares showed a slight improvement on 19 March 2020. However, it slipped by ~2.22% and settled at US$149.73 on 20 March 2020.

Meanwhile, Facebook has announced a ban on advertisements and commerce listings related to medical face masks, hand sanitizer, wipes as well as COVID-19 test kits from its website, in order to help in preventing inflated prices of these products.


Apple Inc. (NASDAQ: AAPL)


Since 12 February 2020, AAPL has reported a significant drop in its share price. On 20 March 2020, the share price dropped by 6.35% from its previous close to settle at $229.24 per share.

The US-based company appears to be committed towards playing an important role in the society amidst the pandemic, as reflected by one of its recent announcements. On 13 March 2020, Apple stated that the outbreak of this deadly disease has impacted everyone in the society. The Company, which believes in technology that can change the lives of people, expects technology to be an important tool in such a scenario.

The company, seeking to play a key role in supporting individuals as well as communities, has announced donations to the global COVID-19 response.

Meanwhile, on 18 March 2020, the Company announced the launch of new iPad Pro with advance LiDAR Scanner & brought trackpad support to iPadOS. Apple is also due to start mass production of new 5G-enabled iPhone 12 in May 2020.


Amazon (NASDAQ: AMZN)


The shares of Amazon dropped significantly from US$2170.22 on 19 February 2020 to US$1689.15 on 16 March 2020. However, the share price registered an improvement and reached US$1880.93 on 19 March 2020. On 20 March 2020, the share price slipped by 1.85% and stood at $1846.09 by the market close.

Because of the outbreak of coronavirus, people are being stuck back at home. Meanwhile, Amazon, along with Netflix and Google, are being pressurized by few regulatory bodies to reduce the video quality at this time, which would help in conserving the bandwidth.

All the three companies have agreed to lower the quality of video streaming from high definition to standard definition because of the high network traffic volume.

Apart from this, due to the COVID-19 outbreak, people are using Amazon services for their daily household products. People are preferring to shop online instead of stepping out of their house. Because of the rising demand, the Company has announced plans to appoint 100,000 workers to meet the requirement of its customers.


Netflix (NASDAQ: NFLX)


Like other FAANG stocks, the shares of Netflix also dropped significantly from US$387.78 on 18 February 2020 to US$298.84 on 16 March 2020. Since last week, the shares showed improvement and on 20 March 2020, the shares settled at $332.83, up 0.24% from its previous close.

Given the increasing cases of COVID-19 along with the government advisory of social distancing, people are staying at home, resulting in increased demand for Netflix services.

However, because of growing internet traffic, the Company has decided to reduce the streaming quality from high definition to standard definition, as highlighted above. The reason behind this is that most of the people have been advised to work from home, and there must be less strain on the internet infrastructure as well as prevent internet outrage.

Apart from this, Netflix has rolled out a coronavirus relief fund worth US$100 million to support its hourly workers that support several projects. The funds would be directed towards those workers who are at risk and those impacted on Netflix production on a global scale.


Google (NASDAQ: GOOGL)


Google shares have dropped significantly from US$1524.87 on 19 February 2020 to US$1068.21 on 20 March 2020.

As highlighted above, Google has also reduced the streaming quality of videos from high definition to standard definition, as more and more people have restricted themselves to their home because of the growing spread of the virus.

The Company, which launched its cloud-based "streaming" gaming system, Stadia, in the later part of 2019, has recently announced plans to roll out a free to play option known as Stadia Base.

For the users who prefer to pay to play, for them also, the Company announced discounting rate for its Stadia Premier Edition Package, which includes Chromecast Ultra service along with 3 months of Stadia Pro to just US$99 for one day.

Do Read: The latest with the Two Popular NASDAQ listed Stocks- NVIDIA and Google


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