Due to the global economy affected by the new coronavirus epidemic, analysts believe that corporate formats such as Netflix will benefit from social restrictions.
COVID-19 was first identified in China in December 2019, but quickly spread to different regions of the world. To date, more than 86,000 people have contracted the disease in 64 countries and at least 2,900 deaths have been recorded. While experts have concluded that the zero point for the new coronavirus is in Wuhan, China, there are currently several other hot spots from which the disease spreads quickly.
South Korea has reported 3,150 cases with 17 deaths, while Italy recently announced a total of 1,128 confirmed patients with 29 deaths. Iran has currently identified and quarantined 593 people, with a high death toll of 43. Japan and France are also potential hot spots, as they reported 241 and 100 cases, respectively. Now health officials are warning that COVID-19 is also spreading to the United States, despite President Trump claiming that great steps are being taken to stop an epidemic.
Since there are no effective vaccines or treatments, health experts advise people to stay at home and avoid unnecessary trips outside, especially to hot spots that are currently caught with the virus. As a result, many industries and businesses have experienced a decline. Even film revenues have been affected by this epidemic, and Wall Street has had its worst sale in nine years. Although according to some analysts, these social limitations could end up in favor of streaming platforms like Netflix.
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In fact, BMO Capital Markets analyst Dan Salmon recently concluded this by noting:
” [Netflix] is an obvious beneficiary if consumers stay home because of coronavirus (COVID-19) problems, and that has resulted in considerable outperformance in stock prices this week. “
Analysts at Moody’s Investors Services, meanwhile, have suggested that if this contagion spreads internationally, more people would seek home entertainment from services like Netflix, Disney +, HBO Max, etc.
The numbers also add up because Netflix stocks rose 0.8% this week, so the streaming behemoth will certainly benefit from this epidemic if it continues to spread. But all things considered, let’s hope it doesn’t happen.
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