It could happen sooner than we think; Pfizer (NYSE: PFE) and BioNTech (NASDAQ: BNTX) are expected to publish the results of large-scale testing of their investigational coronavirus vaccine next month, and 10 more candidates are in phase 3 clinical trials. Consumer confidence has fallen to levels not seen since the 2008 financial crisis at the start of the pandemic, and vaccine approval would be a huge catalyst for global economic revitalization. Here are the top three stocks to buy in the event that vaccine trial results are positive and allow consumers to turn their attention to business.
During the second quarter of last year, the travel agency Expedia (NASDAQ: EXPE) achieved $ 28.3 billion in total bookings of air travel, accommodation, car rentals and vacation packages on its platform. In the second quarter of 2020, the company had just $ 2.71 billion in orders, due to new home orders and travel orders. However, there is a huge opportunity for the company’s stocks to rebound strongly, as long as the worst is behind us. At one point during the year, Expedia’s stock fell to almost $ 40, down from around $ 110 on Jan. 1.
In the event that a coronavirus vaccine passes beyond large-scale clinical trials, vaccination programs would no doubt help restore consumer confidence in the global travel industry. Last year, Expedia generated $ 12 billion in revenue and earned earnings per share (EPS) of $ 3.77. The company’s market cap has now fallen to $ 12.57 billion, barely above 2019 sales.
Fortunately, Expedia doesn’t have to deal with liquidity issues. Its $ 5.5 billion cash balance is sufficient to amortize its $ 6.9 billion long-term debt. Despite its earnings and early share price issues, the company’s shares have managed to rebound more than 92% in the past six months.
Boeing (NYSE: BA), one of the world’s largest aircraft manufacturers and defense contractors, is not having a good year as the pandemic has significantly disrupted demand for commercial aircraft. In July, the daily volume of passenger aircraft worldwide was still down to around 50,000 from 100,000 the previous year. At the same time, the continuous grounding of its 737 MAXs has not helped Boeing’s bottom line. In the second quarter of 2020, Boeing’s revenue fell to $ 11.8 billion, from $ 15.8 billion in the second quarter of 2019.
Fortunately, there is a light at the end of the tunnel for Boeing. The company expects its massive backlog of 4,500 commercial aircraft orders to generate $ 326 billion in future revenue. Boeing also has $ 64 billion in military orders and $ 18 billion in air service orders around the world to survive these tough times.
If a coronavirus vaccine is fully approved, Boeing would be the first to benefit from the subsequent rebound in air travel. The stock is currently trading for as little as 1.3 times the sales futures price (P / S). Meanwhile, Boeing’s $ 32.4 billion in cash and investment is enough to start tackling its $ 59.5 billion long-term debt. From its low point in March, Boeing shares are now up 65% in the past six months.
Since its creation, SmileDirectClubof (NASDAQ: SDC) 3D transparent tooth aligners have been in great demand. Over a million people in the United States use the company’s aligners, with an estimated 97% satisfaction rate. Compared to traditional braces, SmileDirectClub aligners are more convenient and require an average of four to six months per treatment.
Although SmileDirectClub has an online dental channel, it also relies on patients receiving in-person dental scans at the company’s retail stores. This business model has been hit hard by the COVID-19 lockdown measures, which have forced almost all of its 418 SmileShops in the United States to close. In Q2 2020, SmileDirectClub revenue declined 45% year over year to $ 195.8 million. SmileDirectClub stock fell below $ 4 in March and now sits at $ 10.67.
Although many of these stores have reopened, patients are still delaying elective procedures due to fear of the coronavirus. If a vaccine for the coronavirus is distributed, these fears may allay. This would be great news for SmileDirectClub, which hopes it can continue the 53% year-over-year revenue growth it enjoyed before the pandemic struck.
For now, the company’s financial health is also decent, with around $ 389 million in cash to offset $ 420.3 million in debt. If healthcare investors are looking to grab growth stock at a rock bottom price, know that SmileDirectClub only has a market cap of $ 6.3 billion. From March to September, the company’s shares rose more than 170%.