Coronavirus Spread Benefits Netflix, Other ‘Stay-at-Home’ Companies, Analysts Say

Amid fears over a global economic slowdown from the widening coronavirus outbreak, companies like Netflix that provide in-home services are best positioned to withstand the storm or even see upside from the crisis, according to industry analysts.

Netflix “is an obvious beneficiary if consumers stay home due to coronavirus (COVID-19 virus) concerns, and this has been reflected in considerable stock price outperformance this week,” BMO Capital Market analyst Dan Salmon wrote in a research note Friday.

Netflix shares are up 0.8% this week through market close Thursday, amid the worst sell-off on Wall Street in nearly nine years over fears that a broader spread of the coronavirus may lead to a worldwide recession. The S&P 500 index has plunged 8.3% this week through Feb. 27.

In addition to Netflix, other tech companies catering to internet-connected consumers at home that could benefit from coronavirus include Facebook, Amazon, Peloton and Slack, according to MKM Partners analyst JC O’Hara. “We tried to identify what products/services/companies would potentially benefit in a world of quarantined individuals,” O’Hara wrote in a note Thursday, per CNBC. “What would people do if stuck inside all day?”

Earlier this week Perry Sook, CEO of TV giant Nexstar Media Group, also put a positive spin on how coronavirus could affect his business. Nexstar is the largest owner of broadcast TV stations in the U.S. after acquiring Tribune Media last year, with a footprint spanning 197 stations and digital multicast networks in 115 markets.

If coronavirus cases become “more widespread in the United States, and there’s more quarantine in home and all of that, then it could potentially benefit our business because we’d be the primary source of entertainment,” Sook said on Nexstar’s Feb. 26 earnings call when asked about the potential financial impact of the virus.

To date, there have been 83,704 confirmed cases of coronavirus infection and 2,859 deaths, the majority in mainland China, according to the Johns Hopkins Center for Systems Science and Engineering’s coronavirus tracker.

Other analysts have identified home-entertainment providers as seeing a potential silver lining from a wider spread of the virus. “If the contagion became more internationally widespread but short of panic, more people are likely to seek home entertainment options such as from companies like Comcast and AT&T, and streaming TV shows and films from Netflix, Disney Plus, Comcast’s Peacock, AT&T’s HBO Max and others,” Moody’s Investors Services analysts led by Neil Begley commented in a Jan. 29 report.

Companies feeling the most immediate impact from the pandemic have been those with direct exposure to China’s manufacturing sector, as well as travel and tourism industries. Earlier this month, Apple warned investors it would miss revenue estimates for the March 2020 quarter, citing slowdowns in its iPhone supply chain and lower sales in China due to the virus outbreak.

Apple CEO Tim Cook suggested that the worst is over in an interview with Fox Business Network Thursday. “It feels to me that China is getting the coronavirus under control. You look at the numbers, they’re coming down day by day by day,” Cook said. “And so I’m very optimistic there.”

Among the latest coronavirus-related disruptions, Facebook canceled its F8 2020 developers conference and Disney announced that it will shut down its Tokyo Disneyland and Tokyo DisneySea theme parks for two weeks as a precautionary measure. Meanwhile, K-pop sensations BTS have axed their scheduled April concerts in South Korea over coronavirus concerns, and Green Day have canceled Asia tour dates. Organizers of the Geneva International Motor Show canceled the event that had been scheduled for next month after a government edict banning gatherings of 1,000 or more people until mid-March.

Popular on Variety

More Digital

  • Black AF Netflix

    Everything Coming to Netflix in April

    As everyone continues to self-quarantine and practice social distancing due to the coronavirus pandemic, there’s no better “at-home” activity than catching up on all the new films and shows streaming on Netflix this April. A number of new series are set to premiere on the streaming platform, including “Never Have I Ever,” “#BlackAf,” “OuterBanks,” “The [...]

  • Illustration of the video streaming company

    Video Streaming to TVs Soared 85% in U.S. in First Three Weeks of March, Nielsen Says

    During the coronavirus pandemic, Americans are staying home — and, as you would expect, they’re streaming more than ever. U.S. consumers’ viewing of streaming has continued to increase through March. Over the first three weeks of March 2020, the total estimated number of minutes streamed to the TV was 400 billion, up 85% compared with [...]

  • HOOQ Demise Damages The Business Case

    Hooq May Have Fallen But a Business Case for Southeast Asian Streamers Endures

    With coronavirus lockdowns across the region causing a spike in stay-at-home viewing, Friday’s news that Southeast Asian video streamer Hooq is to close within a matter of days came as a shock to its friends and competitors alike. Compared with its regional rivals, Hooq had the most blue-chip backers in Singaporean telecoms giant Singtel, WarnerMedia [...]

  • U.K. Freelancers

    U.K. Government Faces Pressure From Industry on Economic Measures for Freelancers

    The U.K. government is facing increasing pressure from the creative industries after it emerged that economic measures set out for the self-employed last week by Chancellor of the Exchequer Rishi Sunak have yawning gaps in them. The measures may have come as a welcome move for many creative industries workers, but not all are eligible [...]

  • Howard Stern'America's Got Talent' Post-Show, New

    Howard Stern Announces SiriusXM Premier Will Be Free Through May 15

    Howard Stern announced Tuesday that SiriusXM Premier will be free through May 15 as a courtesy to those staying home in an effort to stop the spread of coronavirus. For the next month and a half, listeners will have access to more than 300 ad-free channels, including the Howard Stern Show. Sirius XM is also [...]

  • Lenny Abrahamson Series 'Normal People' Sets

    Oscar Nominee Lenny Abrahamson's 'Normal People' Sets BBC, Hulu Dates

    “Normal People,” a BBC and Hulu 12-part drama, will bow as a boxset on BBC Three in the U.K. on April 26, and will be released in the U.S. on April 29, it was revealed Tuesday. It will also air on BBC One, and RTE in Ireland, dates for which are yet to be confirmed. [...]

  • NewFronts 2020

    NewFronts 2020 Digital Marketing Series Postponed to June

    The 2020 Digital Content NewFronts are moving about two months later as live-streamed virtual presentations, with organizers citing the need for more time for participants to prep. Previously, the annual NewFronts had been scheduled for April 27-May 6 at various venues in New York City — but with the COVID-19 pandemic it became clear earlier [...]

More From Our Brands

Access exclusive content