With coronavirus “stay at home” orders, many of us are stuck cooped up at home. That said, more people are looking for ways to keep themselves occupied — including with video games, TV and streaming. And in turn, these entities like streaming stocks are reaping the benefits.
In fact, Americans are streaming up to eight hours per day with the lockdown. Since the coronavirus began, a survey conducted by OnePoll on behalf of Tubi found that 75% of people “admit to using streaming services more.”
“Streaming is a big part of a lot of consumers’ lives right now. We have seen a tremendous growth in just how much streaming is going on over the last few weeks as COVID-19 becomes more prevalent across many parts of the country,” Scott N. Brown, head of TV product at Nielsen, said. “The amount of time viewers are spending streaming more than doubled in the past year alone, and it’s nearly a quarter of the total time spent on TV among homes that have the ability to stream.”
And the bump includes a lot of younger viewers. “I do think there will be a residual effect or a permanent bump (post Covid-19) in the sense that streaming usage among these age groups will never return fully to their pre Covid-19 levels,” wrote Charles Lindsey, associate professor of marketing in the University at Buffalo School of Management, in an email to InvestorPlace. “The economic situation will definitely have an impact but when all is said and done I think the ‘net’ effect will be a permanent increase in the level of streaming.”
So with the coronavirus likely to pester us awhile longer, streaming video is a likely beneficiary. In fact, here are three of the top streaming stocks to keep in mind at the moment:
With all of that in mind, let’s dive into these companies and see why you should be watching them now.
Hot Streaming Stocks: Netflix (NFLX)
With coronavirus “stay at home” orders making life “fun,” Netflix stock rocketed from a March 2020 low of $290.25 to a current high of $449.52. From here, we may seven see $500. After all, it’s not as if the virus threat is going away any time soon.
Moreover, Goldman Sachs’ analyst Health Terry even reiterated his “buy” rating on the stock with a price target of $490 from $430.
“We believe the COVID-19 crisis is accelerating the shift from traditional content viewership (linear TV, theaters) to streaming services, as the network effect of these additions, the sheer scale of Netflix’s content library, and its growing distribution ecosystem serve to bend the curve of Netflix’s subscriber growth higher both in the immediate and long term,” he noted.
Roku (ROKU)
Since mid-March 2020, Roku has rallied from a low of $58.22 to a recent high of $135.47. And at this pace, ROKU stock could test $150 a share. The company just reported growth in streaming hours thanks to the coronavirus threat. In fact, in the first three months of the year, Roku added three million accounts, and noted that streaming hours jumped 49% year over year, as many people stay at home.
However, the company provided a first-quarter estimate on April 13, and actually provided more insight into how Roku was performing during the pandemic.
“While we believe that our offerings to consumers, content providers and advertisers will enable our Company to deliver value in these uncertain times, the wider business and consumer impacts, as well as the duration of the pandemic, are unclear and thus we are withdrawing our prior 2020 outlook,” Steve Louden, Roku’s Chief Financial Officer said just last week.
Disney (DIS)
Granted, Disney was forced to close its parks around the world. However, streaming services helped force the DIS stock from a recent low of $79.07 to $107.64.
Just months after launching its streaming services, Disney has more 50 million global subscribers. That’s up from the 28.6 million count disclosed in its first quarter earnings. And that’s a blessing for a company whose ESPN was suffering even before coronavirus hit.
“If you look at the increase in streaming usage, Netflix/Hulu/Disney+/You tube/Amazon Prime are all up relative to their pre COVID-19 levels but the networks are about the same,” wrote Lindsay.
Additionally, as the coronavirus persists, Disney’s sizable bet on streaming is likely to pay off well. And Robert A. Iger, Chairman and CEO of Disney seems to think so, as well:
“We had a strong first quarter, highlighted by the launch of Disney+, which has exceeded even our greatest expectations. Thanks to our incredible collection of brands, outstanding content from our creative engines and state-of-the-art technology, we believe our direct-to-consumer services, including Disney+, ESPN+ and Hulu, position us well for continued growth in today’s dynamic media environment.”
Overall, with the coronavirus appearing to be around for awhile, we’re likely to see even more growth in its streaming services.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999. As of this writing, he did not hold a position in any of the aforementioned securities.
