The Cowen Insight
The COVID-19 pandemic has shifted consumer behavior and has driven permanent change. As we consider the post-vaccine era, the “everything from home” environment has driven consumers to embrace a multitude of stay-at-home services.
10 Cowen analysts collaborate and leverage proprietary Cowen survey data to identify the permanency of key stay-at-home trends across the TMT, health care, and retail sectors. We also identify the stocks best positioned in this new environment.
A Collaborative Report to Identify Stay-At-Home Staying Power
The unprecedented COVID-19 lockdown and subsequent “everything-from-home” environment is driving a level of permanent change in U.S. consumer behavior. Americans are growing (or are forced to grow) accustomed to emerging online applications and services in the home.
The familiarity with at-home applications is growing. They also often bring with it additional cost savings and conveniences, which will continue to drive the emergence and/or acceleration of a multitude of at-home online trends. In this report, we provide insights into the emerging/accelerated at-home trends, identify the permanency of services in a reopened, post-vaccine era, and identify those stocks best positioned to embrace said trends.
The Importance of ISPs in a Stay-At-Home Trends
The internet service providers (ISPs) are keeping up with augmented demand and they are reaping the financial benefits. There has been a renaissance of unit growth. Though, it comes with a heightened level of network requirements including more download capacity, upload capacity, lower latency, and “always on” reliability as ISPs harden their networks. We believe Cable CapEx estimates should increase, specifically in “scalable infrastructure” and “line extension.” However, this is more than offset by the solid FCF delivery from the outsized broadband additions.
Adoption of At-Home Services via Applications
On the application layer, we explore key at-home services including OTT adoption (cord cutting), telehealth, traditional media, gaming, smart home/IoT device adoption, remote fitness, curbside pickup, at-home retail, online grocery, and restaurant online pickup/delivery services.
The lockdown resulted in meaningful (in many cases unprecedented) rallies for “at-home” stocks over the past ~9 months. This story continues to evolve. “At home” stocks are vulnerable to the rotation play into travel/hotels/cyclicals in 2021, exemplified by the November 9th vaccine announcement. That said, we leverage our cross-collaboration and proprietary survey data to identify the permanent trends and those stocks best positioned for staying power
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