The coronavirus pandemic hurt businesses as restrictions to check the spread of COVID-19 resulted in widespread loss of revenue, job losses and closures.
But some ASX-listed companies have managed to gain advantage amid the chaos inflicted by the virus.
On February 24, $60 billion was wiped from the value of the Australian stock market as investors fully grasped the threat of the pandemic to the economy.
It was the market’s worst day in six months, and the start of a lengthy slide for stocks. The giant sell-off continued until March 23, when the market hits its lowest point.
While most businesses have resumed trading, the pandemic continues to pose challenges. The S&P/ASX200 benchmark index lost more than a third of its value at the height of the crisis and is still down over 16 per cent.
Here is a list of ASX-listed stocks that have performed best during the turbulent period starting February 24. Our measure has been the best return to shareholders, including dividend payments, with a minimum market capitalisation of $250 million.
While shares in these companies were not immune to the market downturn – most suffered sharp declines in line with the market, they have recovered better than most.
KGN – KOGAN.COM – $13.23 (up 150 per cent)
The online retailer has reported a doubling of sales in April and May even as lockdowns restricted activity in the rest of the retail sector. This follows a 20 per cent jump in first-half profit. Burman Invest chief investment officer Julia Lee says Kogan was one of the beneficiaries of an accelerated shift towards online spending. Without bricks and mortar stores, it did not suffer in the way that Myer or Premier Investments did during the pandemic, she said.
Z1P – ZIP CO – $6.53 (up 90 per cent) Zip Co is a buy-now, pay-later provider. Like larger rival Afterpay it has seen a jump in users as online shopping has boomed during the COVID-19 pandemic. CMC Markets chief strategist Michael McCarthy believed a key factor helping Zip Co’s returns was that prior to the virus, many people viewed it as a latecomer to the payments space. PPH – PUSHPAY HOLDINGS – $6.87 (up 69 per cent) Pushpay provides software to help churches collect donations – particularly useful during the pandemic. Pushpay’s strong full-year performance and projections of collecting more than $US1 billion in revenue may have prompted analysts to upgrade the stock, but CMC Markets’ Michael McCarthy warns the rise in its share price had been a product of crowd behaviour rather than business fundamentals. AEF – AUSTRALIAN ETHICAL INVESTMENT – $5.70 (up 52 per cent) AEI’s has been garnering interest for the last few years over its investment philosophy of putting members’ funds into causes such as renewable energy, and avoiding companies that exploit workers or animals. The recent push for greater attention on environmental, social and governance (ESG) issues has received a boost from the COVID-19 crisis. Bell Direct analyst Jessica Amir says a 39 per cent jump in AEI’s full year net profit has underpinned that sentiment. MSB – MESOBLAST – $3.92 (up 50 per cent) The Australian biotech firm has been in the spotlight for its trials of a COVID-19 treatment. Its Remestemcel-L treatment produced encouraging results on a group of 12 patients using ventilators in the US and has since been extended to 300 patients. That trial is still to be completed but the absence of results has not stopped investors buying shares and sending the price higher. APT – AFTERPAY – $52.10 (up 47 per cent) The buy-now, pay-later market leader has bounced from its March 23 low of $8.01 amid an online shopping boom. It is also making headway in the US market, where it had more than five million active shoppers by May-end. Chinese gaming and social media giant Tencent Holdings also cast a vote of confidence when it bought a 5.0 per cent stake in Afterpay in May. WAF – WEST AFRICAN RESOURCES – $0.95 (up 54 per cent) The gold producer’s interest in a gold project in Burkina Faso has attracted investors in recent months, with Burman’s Ms Lee saying interest has also been piqued by its exploration results. AKP – AUDIO PIXELS – $21.08 (up 53 per cent) The technology firm is developing a silicon chip that it says will produce superior sound and greatly reduce the size of speakers. However it is yet to generate revenue and Mr McCarthy puts it in the speculative category. Other top performers include WA gold explorer BELLEVUE GOLD (up 36 per cent) and mining giant FORTESCUE METALS GROUP (up 36 per cent).