It was a year ago when COVID fears rocked the financial markets and pushed economies into lockdown. While all of us had hoped that it would end in short order, we still find ourselves socially distanced and are just passing the peak of the 2nd wave. The good news is that cases are falling quickly and vaccinations are on the rise. With the Great Re-Opening coming, we will be ready to emerge from our homes in a big way. 

Cases down, vaccines up

In the first week of 2021, daily cases peaked at over 300k. Since then we've been trending in the right direction with cases down to just 52k yesterday.

Covid cases Feb

While the vaccine rollout has been slower than anticipated, the speed has increased to an average of 1.64 million doses per day and is expected to pickup with pharmacies like CVS and Walgreens starting to get in on the action. At current levels, roughly 50 million Americans will be vaccinated before the end of March and 100 million by the end of June.

With warmer weather and increased vaccinations, this is setting up the economy for a big boom in the 2nd half. There is tremendous pent up demand to get back out traveling, getting together with friends, and returning to a more normal existence.

Re-Opening Winners

Last year, stocks that did the best were the lockdown beneficiaries. For example, online retailers like Amazon and Chewy were big winners as people ordered more online. In the wellness space, Peloton crushed expectations as people shifted from gyms to working out at home.

In 2021, new winners will likely emerge. It makes sense to shift a portion of your portfolio to companies that will benefit from life returning to normal.

One sector set to rebound is leisure travel. While international and business travel will likely remain impaired for sometime, leisure travel will bounce back first. My family and I look forward to visiting family and even venturing to a theme park. How do you feel? Companies like Sprit Airlines, Expedia, and Booking are worth a look. While it is unclear when cruises will be allowed to sail again, bookings are already rising.

During COVID, athletic apparel was the only segment of the apparel market that grew. Yoga pants replaced the pant suit during the work from home. Upon re-opening, many of us will be looking to upgrade our wardrobes. Perhaps it will be like the roaring 20s as people will be dressing up and wanting to look their best.

These are just a couple of sectors that will benefit from the Great Re-Opening. We've been working hard to identify companies that have lowered costs, strengthened their position, and will perform strongly during the next phase. We looking forward to the year ahead and the return to a more normal life!

“DSC01166, The Rotterdam and Celebrity Cruise Ship Century” by jimg944 is licensed under CC BY 2.0