Beaten-Down Stocks Likely To Bounce Back After COVID-19

In the stock market, buying low and selling high is the name of the game. That, of course, is easier said than done. For the average investor, attempting to time the market is a fool’s errand, but there’s no rule against using a little critical thinking to sniff out stocks that suffered steep losses but are now poised for a comeback. 

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With the virus now apparently on the wane, there are plenty of stocks that fit the bill. COVID demolished airline stocks, oil stocks, and stocks attached to companies in the tourism/hospitality/theme park industry. Many others weren’t directly affected by the virus but were simply swept out with the tide. A lot of those stocks are still on sale but appear ready to return to their former glory as soon as the virus fades this summer or hopefully even sooner. Those are the ones that you might want to consider getting in on now while the getting is still good.

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Readers will notice that some of the following stocks have already clawed their way back to near their 52-week highs. That, however, is a bit deceiving. The crash of 2020 began on Feb. 20 of last year, so 52 weeks ago was after the stock market slaughter had already begun and highs were no longer particularly high. 

Last updated: Feb. 25, 2021

• Current price: $31.27
• 52-Week High: $43.06

Cruise ships were one of the original victims of the virus—and some of the virus’ first victims spent the early days of the pandemic quarantined on cruise ships. It appears that Norwegian has given up on spring—on Feb. 16, the company announced it was extending its suspension of all cruises through May. Summer, however, still looks salvageable. Norwegian’s stock has come a long way since its 52-week low of $7.03, but when full ships begin setting sail once more, the stock will likely set sail with them.

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• Current price: $27.01
• 52-Week High: $38.11

Like Norwegian, Carnival has canceled all cruises until June. Also like Norwegian, Carnival is reporting strong bookings for late 2021, an indication that there’s widespread pent-up demand for cruises. That dynamic could send Carnival stock soaring—it already is, compared to its 52-week low of $7.80.

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• Current price: $8.22
• 52-Week High: $10.76

The cosmetics industry learned the hard way that demand for beauty products drops when people are mostly stuck at home and wearing masks when they aren’t. Most recently, the company posted a 16 percent drop in revenue in the second quarter. But when entertainment, nightlife, and vacations become a part of life again, so, too, will Burberry, Covergirl, and the rest of Coty’s brands. At its lowest over the last 52 weeks, COTY sunk all the way to $2.65 per share.

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• Current price: $54.96
• 52-Week High: $76.18

As the glue that binds the travel and tourism industry, airlines were battered early and badly by the pandemic. United, however, is making steps to take full advantage when the masses return to the skies. It recently launched a special center that allows travelers to get tested for COVID at the airport and its CEO announced that he’s hoping to make vaccination mandatory for all employees.

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• Current price: $96.66
• 52-Week High: $98.36

Royal Caribbean has recouped much of the losses it suffered during the pandemic and it’s still not even sailing ships. The company is planning to take to the seas one month before some of its industry competitors who are suspending cruises through May—Royal Caribbean has announced its shutdown will run only through April. At one point in the last 52 weeks, RCL shares cratered to $19.25.

• Current price: $46.71
• 52-Week High: $78.43

Oneok is an energy company that focuses on pipelines that move natural gas. Crashing energy prices appear to be the main culprit behind the dramatic fall in the company’s stock price. According to the Energy Information Administration, however, natural gas prices are expected to continue rising through 2021—and OKE shares might rise right along with them.

• Current price: $28.16
• 52-Week High: $39.62

The pandemic reduced by half the number of cars on the road and closed factories all over the world. All that was bad news for the oil industry. Now, however, oil is roaring back. In fact, the price of crude recently hit a one-year high. OXY’s 52-week low was a sad $8.52.

• Current price: $7.59
• 52-Week High: $16.17

TechnipFMC PLC is a British oil and gas exploration firm. Costly projects to drill for oil are hard to finance when oil prices are low. Now that they’re bouncing back, however, this could be one stock that will rise with them.

• Current price: $21.82
• 52-Week High: $25.75

American Airlines is creeping back toward its 52-week high—its stock bottomed out at just $8.25 during the same time period. The airline—which was hard hit by the virus, just like the rest of the industry—recently warned 13,000 employees of impending furloughs as federal aid to the airline industry is set to expire. The company is also, however, preparing for a return to air travel in interesting ways, just like some of its competitors. For example, American is allowing flyers to use their miles to pay for COVID tests.

• Current price: $11.84
• 52-Week High: $12.30

Marathon, too, got hammered by the oil crash that COVID helped create. The company recently reduced the salaries paid to the CEO and board, and now, its stock price is close to its 52-week high now that oil is on the rebound. At one point over those same 52 weeks, MRO shares plummeted to just $3.02.

• Current price: $8.94
• 52-Week High: $25.08 

Noble Energy posted over $1 billion more in revenue in 2019 than it had in 2016. That fact could point toward it being one of the oil companies that are strongly positioned to take advantage of the fact that oil is roaring back to life. 

• Current price: $49.60
• 52-Week High: $54.71

Delta shares joined most other airline stocks in falling sharply in early 2021 on news of new COVID restrictions. The company’s CEO has come out strongly against mandatory testing for all passengers. No matter the outcome, Delta is ready to start filling up airplanes with people who are primed to get out and see the world again. Its share price is already nearing its 52-week high. Its lowest price during that time was just $17.51.

• Current price: $119
• 52-Week High: $141.04

This real estate investment trust (REIT) owns properties focused on activities like shopping, dining out, and other forms of entertainment. While these businesses are currently hurting, it might be a safe bet that in the long run, they will bounce back after the coronavirus subsides.

• Current price: $73.80
• 52-Week High: $74.60

COVID put independent oil and gas companies in a bad spot, particularly those like Diamondback that have focused on expensive fracking projects. However, energy prices are roaring back and FANG shares are just a hair away from their 52-week highs. If you’re considering jumping in, you might not want to wait much longer. FANG is already up by double-digits on the year.

• Current price: $38.63
• 52-Week High: $39.91

Hotels and casinos were among the businesses hit the hardest and earliest by the virus. But while they’re still struggling to operate safely right now, a break in the weather is on the horizon. Publications like Barron’s are calling MGM a buy now that Vegas is easing restrictions and MGM is moving back to 24-hour operations.

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Joel Anderson contributed to the reporting for this article.