Netflix, Peloton bring the pandemic-stock era to shuddering halt
BNN Bloomberg
The COVID-19 pandemic isn’t over yet, but the boom it helped create for stay-at-home stocks appears to be vanishing.
The COVID-19 pandemic isn’t over yet, but the boom it helped create for stay-at-home stocks is vanishing.
Netflix Inc. and Peloton Interactive Inc., two of the highest-profile stars of the lockdown era, both plunged Thursday -- the latest sign that investors have moved on from the so-called pandemic trade. Netflix expects to add a paltry 2.5 million users in the current quarter, well short of estimates. Peloton, meanwhile, is slashing costs to cope with slowing demand for its stationary bikes.
Netflix shares were down about 20 per cent in premarket on Friday, holding the drop seen in late trade on Thursday. If the loss sticks, it would be the stock’s biggest drop in almost a decade. Peloton shares were up 5 per cent in premarket after sinking 24 per cent on Thursday.
The two companies are the latest darlings of 2020 to sink to levels not seen since the early days of the COVID-19 outbreak, when investors first deduced that lockdowns and easy-money policies from the Federal Reserve were going to send stocks like Netflix soaring.
Others are suffering as well. Zoom Video Communications Inc., the owner of the ubiquitous videoconferencing software, is trading at the lowest level since May 2020, as is e-signature company DocuSign Inc. Both stocks have lost more than half of their market values from record highs and slid further after Netflix’s results. Etsy Inc., the e-commerce company that saw strong pandemic demand for face masks and other products, is down more than 45 per cent from a November peak. It last closed at its lowest since May.
