If you were to ask me what distinguished companies that had the best stocks to own this quarter, I'd say it's the ones that had the most ingenuity and a lot of good luck. There were tons of winners, many of which were stocks that simply bounced back from the horror show that was the end of March when a couple of doomsaying hedge fund managers pushed the stock market down with their grim apocalyptic predictions. Those are too numerous and were often just companies that were written off before the federal reserve got involved backstopping the credit the market afforded them. This is not a piece in praise of Carnival Cruise (CCL) or Royal Caribbean (RCL) .
No, I want to talk about companies that I think are here to last and can even dominate during this continuing pandemic that shows no sign of abating. If anything, it's getting worse, not better because of the selfish people who won't wear masks or practice social distancing. Mind you, this is a totally subjective list of companies I think blossomed and are going to dominate long after this scourge is at last put to bed.
First is Zoom Video (ZM) . There were many companies that could have become the de facto way we do video business, but it was CEO Eric Yuan who came up with the easiest method to get together without being with each other. Cisco (CSCO) has Webex for the enterprise, Ring Central (RNG) has a partnership with an existing corporate landline provider, but it is Zoom that has brought us together. When you think of so many companies that could have done this, Microsoft (MSFT) , Apple (AAPL) , Google (GOOGL) , it is incredible to me that this independent company has become so ingrained in the new stay-at-home, work-at-home environment. I believe that Zoom has fundamentally changed the way we will interact and it will never be the same even after a vaccine.
Second, Paypal (PYPL) . This company, which was lucky enough to be the online merchant processor for many companies coming into the pandemic, is emerging as the de facto bank for small- and mid-sized companies around the globe. The rise of Paypal in the world of finance is unprecedented. Banks were always brick-and-mortar entities, but Paypal shows you that you don't need them. I would never have thought we would go from cash to plastic to digital this quickly, but that's what Paypal has done. CEO Dan Schulman has a vision of democratizing money. It's no longer a vision. It's a reality.
Third is Apple, and this was still one more quarter where Tim Cook's leadership dazzled, despite international tensions and the closing of much of the retail network. We weren't expecting much from the iPhone 11. It was considered just another iteration. The 11 is a gem. It, in conjunction with the watch and the Air Pods, have become the most ubiquitous devices in history. Remember, I said ingenuity and luck? I don't know how much of Cook's plan would have led to a razor-to-razor blade model, but that's what has happened with this service revenue stream. In an era where we can't have contact, Cook has produced a contactless credit card. The App store doesn't get its due, but it's worth billions of dollars. The fabulous customer satisfaction levels have allowed Apple to come up with the lifetime value of a customer, based not on the hardware but on all the services people take with it. Sometimes, when I read Twitter (TWTR) , I am struck by how people like to insult me for not knowing what makes money. How about owning Apple and not trading it?
Out of nowhere, this quarter Tesla (TSLA) became a $200 billion company. It did so because it's not a car company. It's a technology vehicle that you drive. That was the wisdom of Elon Musk and its why the company's market cap approaches the largest auto company on Earth, Toyota (TM) . I think the endless comparisons with vehicle companies' vales leaves me cold. Musk's cars sell everywhere and they sell without advertising. They really are the only successful electric vehicles. Once we realized that Musk could raise as much money as he needed to expand, that was the end of doubt and it's been off to the races ever since.
We know that Amazon (AMZN) had a ridiculously good quarter. But I like the rise of Shopify (SHOP) as the alternative system, the way that small- and medium-sized businesses as well as some large consumer product companies delivered goods to those forced to stay at home. At the beginning of the quarter, few had heard of Shopify. By the end, people recognized that if you needed omnichannel to sell things, and everyone did because you couldn't go anywhere, then you needed Shopify's infrastructure to make it work. I think Shopify will create more millionaires than any other company on the continent.
Shopify wasn't alone in empowering small- and medium-sized businesses. Twilio (TWLO) , Fastly (FSLY) , Adobe (ADBE) , and Wix (WIX) all helped to make the small businesses thrive when they would have failed. Etsy (ETSY) allowed creativity to thrive, too.
In retail this was the moment when Lululemon (LULU) became the standout simply because it captured the vision of what you wear when you work at home. The Mirror acquisition furthered that and allows it to rival another winner, Peloton (PTON) . Many hedge fund managers bet against these companies. They failed. Remember, ingenuity and luck powered many victories.
We had some major secular themes that came to the fore, the dominance of the data center, artificial intelligence, software defined vehicles, and gaming. They were certainly benefactors of these trends, but only one company captured all of them: Nvidia (NVDA) . I am unabashed. I love Nvidia. I think Jensen Huang is really not of this world. He's an engineer, he's a builder, he's a leader, and he's an artist. That's why I consider him a modern day da Vinci. Our country is made strong by so many companies, but few come near the power of Nvidia.
You want luck and ingenuity? That's Netflix (NFLX) . This company, like Amazon, was made for a pandemic. As we get more big screens, as we get faster broadband, the world turns to Netflix. Like Tesla this company has been written off endlessly. Now it's the companies that made us doubt Netflix that are struggling and this company's the darling that can raise the price and there would be little resistance.
Finally, I want to mention Regeneron (REGN) as the drug company for this era. It has an amazing anti-cholesterol drug, the best macular degeneration medicine, a fantastic anti-cancer portfolio, but most important, it is the company in the lead for getting this illness under control, so it is not going to kill another 100,000 people. It has a monoclonal antibody that when used in a cocktail should defeat this scourge. I think it has the inside track on the vaccine, given its Ebola work. And, once again, in a common theme, Len Schleifer and George Yancopoulos, the CEO and the chief scientist, are unheralded. Len was our first guest on this show. The stock was at $5. It's now at $617 and it's not stopping.
There are many other companies I could cite. But these are the ones that grabbed this moment by the bulls' horns and are riding them into greatness. It won't be stopped any time soon.