Shares of “work-from-home” names including Peloton, Netflix and Roku, fell on Monday following efficacy news on the COVID-19 vaccine front. Yahoo Finance Editor-at-Large breaks down the price action of these stocks.
Video Transcript
MILES UDLAND: It’s interesting that maybe no one who was buying Zoom ever thought there’d be a vaccine, which I thought that was– I thought we all knew that, right?
DAN ROBERTS: Well it’s so strange, Miles. I mean, we’ve been watching these names all day in some sense. I understand the reaction. You know, the Pfizer news about the vaccine comes out, you’ve got people saying, all right, the pandemic’s over, back to the office. But look at the percentage slides here, and overall broadly, it looks in many cases like an overreaction. I mean, I really think you have to go case by case with each name.
With Peloton on down 17%, it’s debatable. I mean, we’ve discussed this before, but once the pandemic is over– we’ve talked about this for months and debated it– will people go back to gyms? I mean, anyone who already bought a Peloton is going to continue to work out at home and they’re going to continue to pay those fees for the workout classes, you know, the software, the subscription service. And then if you want to argue that no one else will buy Pelotons– fine, I disagree. I think Peloton’s momentum is going to continue, but I actually understand that argument.
But then you look at something like Zoom. Zoom is down 17%. That’s so silly to me, because what have we said all pandemic? We’d have had experts roll through our live shows and say that work from home, remote work, whether it’s from home or from somewhere else– you know, Airbnb is trying to push this, too– that in the new normal, you’ll be able to look at Airbnb and work from the Airbnb, and that’s why we’ll be OK. That’s the future. We’ve heard people say remote work is the future.
So what do you think? People will stop using Zoom just because there’s a vaccine? I mean, Roku is down big today, Netflix is down big today. Do people really think– does the market think that people aren’t going to be streaming on Netflix and Roku now that there’s a vaccine? So you do have a case by case.
I mean, you had a great tweet this morning of another example– Chewy. Chewy, which has been seen as a stay at home trade, is down big today– 17%, as well. You think people who have switched to being Chewy customers, who buy their dog food online will now stop doing so because there’s a vaccine? So I’m writing about this, because in many cases, I think it’s a huge overreaction. In some cases, of course, it’s debatable you could argue that the slide makes sense because the momentum those companies have seen is going to slow once we all return to normal. But overall, it’s just kind of a classic knee jerk market reaction to me.
MILES UDLAND: And I guess, you know, Dan, to quickly kind of follow on that, everyone was so sure that the world was going to change forever and all these stocks were big secular winners all through the summer, and you do wonder now, was that perhaps a bit too pat?
DAN ROBERTS: Well, that’s– to me, that’s been the biggest story of the pandemic. The biggest business story is which things that changed during the pandemic will remain changed after the pandemic. You know I’ve been obsessed with talking about curbside pickup and both BOPIS– buy online, pick up in store. We had retail people tell us that’s the future. now even when stores can reopen in the pandemic’s over, a lot of people will never go back to a store. So that’s another great example.
Look– Slack is down significantly today. You think workplaces are going to stop using Slack? Doesn’t matter if you’re in the office or you’re at home– workplaces that use Slack are still going to Slack. So it’s just going be fascinating to watch these names over the next few weeks, you’re right. And a lot of hot takes might be proven wrong or in six to eight months, they might be proven right.
