Who would have thunk it? Who would have figured what people would do in a pandemic, because after all, it's our first. The results? They are counterintuitive, staggering and still worth investing in, because so few people -- even the executives -- saw them coming.
We know that people are hanging on Facebook (FB) and looking through the Apple (AAPL) store while they order on Amazon (AMZN) and search on Alphabet (GOOGL) . Hence, why the CEOs of those four companies are going to face a hostile audience. They are simply doing too well.
Who would have thought that as successful as these companies were before the pandemic, they are even more successful now. If I weren't Jimmy Chill, I would be jealous of them, even on the eve of their being drawn and quartered for being so powerful and indispensable. The House Judiciary Committee on Antitrust would love to make these companies less powerful, but the pandemic simply won't let them.
The tech nexus is well-known and potent, and everyone wants to see the rich humbled, except other rich people. But remember that my great, great uncle Vlad Lenin said that if the rich are unhappy, it's their own fault. I mean, who would have thought that someone would invent a company that sends you what you can get at the store when you fear for your life when you go to the store. Let's give Jeff Bezos his due, while we rake him over the Kingsfords.
But that's not what I am talking about. I am talking about the big surprises, the things that people are doing when you can't go to the movies, when you can't go to the ball game, you can't ship your kids off to camp or fly to Europe or get into Disney World (DIS) , or go on a cruise.
I am talking about it, because the consumer's behavior is shocking, and nobody saw it coming, which is why there is so much money being made by so few people.
Here's your Top 10 shockers -- the Top 10 companies with stocks that are on fire, because they were able to capitalize on the Great Pandemic of 2020. Remember: They have to be shockers. We aren't including Lululemon (LULU) , because it was hotter than hot before the pandemic. And we aren't going to include Tesla (TSLA) , because we are sick of Tesla the company, and have no idea how to value the stock, except it knows something and it goes higher. Or the investors know something. Someone knows something for certain.
No. 1? Let's start with something that happened Tuesday, the report from Polaris (PII) , the outdoor vehicle company. This is the juiciest pandemic paradox there is. When we go into a recession, stock traders know one thing for certain: You should short the stock of Polaris, because an ATV is about as unnecessary as a hole drilled into your head. Even Scott Wine, one of my favorite CEOs, admitted on his call that he missed his estimates by a country mile, except he missed how robust they are. Turns out an ATV is the ultimate pandemic pastime, especially because you wear helmets and gloves. You couldn't give Covid to each other on these babies if you tried. Beats sitting in a Miami Marlins dugout. If you believe, as I do, that we aren't as close to a vaccine as Moderna (MRNA) says we are, you stick with this one.
No. 2, we just got a report from Sherwin-Williams (SHW) and, here's a wild one: people like to paint their homes when there is nothing to do. I would rather hammer nails into my hands, but I don't represent the people who go to Lowe's (LOW) and buy Sherwin-Williams paint. Again, in a recession you don't bother to fix up your home: It's an expense, because your home goes down in value in a recession. But not this recession: It's going up as people flee the cities. We got an amazing set of numbers from America's builder, D.R. Horton (DHI) last night. If you can make your house worth more, you do it. You buy Sherwin Williams paint. You buy the stock.
Third: Mattel (M) . We had Ynon Kreisz on "Mad Money" last night and the Mattel CEO talked about skyrocketing Barbie sales, big big numbers. But what I found to be most amusing is that UNO is now the biggest board game in the country. You know why? It's a two-person game and it is an ideal quarantine pastime. Yep, in a world where so many have had to quarantine, UNO's a savior.
Speaking of saviors, No. 4 is Wayfair (W) . This company seemed to be on the ropes as recently as February, but it has made a huge comeback as people create offices in their homes. No one wants to go to a furniture store and risk getting sick, so they go to Wayfair. Now it's stock is en fuego and it's here to stay. Can you believe it? A furniture stock on the new high list in a recession. Should be in the new low list.
Speaking of the new low list, in every recession I can recall you have to bang down the recreational vehicle stocks. Thor (THO) gets the hammer. Now, it gets the gold. That's right, I know so many ultra rich people who are so fearful of Covid that they want to travel in style, and that means buying a motor coach. It's most likely going to be a Thor. Yep, the easiest stock to short has become the fifth pandemic paradox.
Sixth, sticking with this RV theme, many thought that the company that Marcus Lemonis built, Camping World, was at death's door. It was endlessly shorted as traders scanned their lists for what should blow up in a recession. Well Camping World (CWH) blew up, blew up from $3 to $36.
Seventh: Tractor Supply (TSCO) was never a bad retailer. You can buy some nice Carhart clothes -- I like them, wife hates them, and you can get some excellent stuff for the garden. But it turns out in a pandemic gardening is like going to Disney World and Europe and a fancy hotel. Well, not really, but I see a lot of novice gardeners now following the Chill man on Twitter. They are getting the hang of it and many are going to the gentleman farmer's home away from home: Tractor Supply.
Eighth: The gardening newbies don't want to come up with anemic zucchinis or tomato plants that make you want to go to the 7-Eleven for better tasting veggies. So they pour on the Scott's Miracle Grow (SMG) for a can't miss garden. I know it's not exactly natural and organic, but who watches you do it? Just tell em you have a real green thumb while you buy the stock.
No. 9, I know a guy who bought a Boston Whaler for 40 grand and no sooner did he do so than someone offered him 30Gs to rent it for the summer. Why? Guy had three boys who were driving him crazy, because they had nothing to do. Boating is a terrific time suck, and a lot a lot of fun. We take out my 17-foot Boston Whaler, with its four 250 Mercury engines, no actually one 90 Mercury, and we do nothing. Sometimes we bring fishing tackle. Sometimes we just bring sunscreen. Yet the stock of Brunswick Corp. (BC) can't make up its mind. If this were a recession, you'd short this thing until the cows come home. Now if you shorted it, you got the "No Country for Old Men" bolt in your forehead. I think Brunswick's a beast going into earnings Thursday.
As a 10th pandemic paradox, I am going to give you one that you might have been able to suss out, but would probably fail: Boston Beer (SAM) . If you haven't had a Truly, forget about it, if it is a Truly Lemonade. We can't find them anywhere. This spiked hard seltzer is here to stay. In a recession liquor sales always do better, but not in this one, because bars are an anathema to social distancing. But Truly by Boston Beer? It's an at-home liquor that's driving beer to the back of the store.
There you have it, 10 pandemic paradoxes with great stocks that should have been horrendous, but investors and even executives just didn't see it coming.
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