This stock could zoom upwards

After soaring in 2020 due to the pandemic, Zoom (NASDAQ: ZM) has fallen back significantly this year. In fact, over the past year, the stock is down 54%. This is mainly due to fears that the excellent growth was solely due to the pandemic, and it will slow significantly in a post-Covid world, with face-to-face meetings the norm once again. But with the fears of the new variant, this Covid stock may be an excellent pick once again.

Despite this, many people believe that stock is just a coronavirus play, and long-term growth prospects are shaky. But while this is a risk, I believe Zoom is more than just a Covid stock, and the new variant simply gives it a further boost. In fact, for the FY2022, the company expects revenues of over $4bn, over a 50% rise year-on-year. This is despite the fact that face-to-face meetings have become far more common once again. Therefore, this is a stock I’m tempted to add to my portfolio.

A telehealth provider

I’ve written about my optimism for Teladoc multiple times, and the recent variant news has reinforced this. In my opinion, the stock is oversold, and is now 62% off its recent high. Over the past year, it has also fallen 45%. Like Zoom, this has been due to fears of slowing growth after Covid.

But with the new variant, this offers an ideal opportunity for the company to gain new customers for the long term. I believe this should prompt the stock to recover some of its recent losses, and therefore I may buy more.

A UK Covid stock

ASOS (LSE: ASC) is another stock that has struggled in recent months, especially as revenue growth for the next financial year is only expected to be around 10-15%. Issues of labour cost inflation and other increased costs have also had a negative effect. This has led to fears around the company’s profit margins, which are currently at only 5.3%.

But I think that the new variant could lead to increased demand, especially if many shoppers decide to go back to online shopping. This should help boost profits, which will also allow heavier investments in parts of the business, such as in the US.

Even without any potential boost from this new variant, the ASOS share price still looks too cheap. In fact, it has a price-to-earnings ratio of around 20, and a price-to-sales ratio of under 1. For a growth stock, this is incredibly cheap. As such, although there are several risks to consider, this is a Covid stock that I’m very tempted to add to my portfolio.

The post 3 Covid stocks to buy now appeared first on The Twelfth Magpie.

More reading

• The £15bn defence splurge that could send UK shares soaring in July
• Up 446% in 12 months! What’s next for the Ceres Power share price?
• How much is needed in an ISA to unlock £1,220 of passive income a year?
• Forget meal deals! Here’s how £8 a day could be worth £357,000
• Up 132% and surging, how is this FTSE 250 share STILL so cheap?

Stuart Blair owns shares in Teladoc Health. The Motley Fool UK has recommended ASOS, Teladoc Health, and Zoom Video Communications. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.