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Why Peloton, Teladoc, DocuSign, and Other Stay-at-Home Stocks Are Rising Today

By Joe Tenebruso - Apr 13, 2021 at 12:06PM

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A setback for a major coronavirus vaccine maker is driving investors to seek shelter in stocks that have held up well during the pandemic.

What happened 

The Food and Drug Administration's move to temporarily halt the rollout of Johnson & Johnson's (JNJ -1.10%) COVID-19 vaccine sparked a rally in so-called stay-at-home stocks on Tuesday. 

As of 11:30 a.m. EST, shares of Peloton (PTON 13.60%), Teladoc Health (TDOC 6.13%), and DocuSign (DOCU 2.77%) were up 3%, 3%, and 5%, respectively. 

So what

The FDA said it would ask states to pause their administration of J&J's drug while it reviews data involving six reported U.S. cases of a "rare and severe type of blood clot in individuals after receiving the vaccine." The regulatory agency noted that these incidents were "extremely rare," and it was recommending a pause in the use of J&J's vaccine "out of an abundance of caution." 

A person is pointing to a digital stock chart with three lines that are rising sharply above a flatter line.

Stay-at-home stocks rallied on Tuesday. Image source: Getty Images.

Still, the news prompted many investors to rotate out of stocks poised to profit from a post-pandemic economic recovery and into companies that could benefit from a slower vaccine rollout schedule. This rotation helped to drive up the share prices of home-based fitness star Peloton, telehealth provider Teladoc, and e-signature leader DocuSign.

Now what 

Powerful trends -- such as the rise of virtual healthcare services, in-home fitness, and remote work -- should continue to fuel Teladoc, Peloton, and DocuSign's growth long after the COVID-19 crisis subsides. So, while today's vaccine news may be providing a short-term boost to their stock prices, it's these core growth drivers that will ultimately power investors' long-term returns.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends DocuSign, Peloton Interactive, and Teladoc Health. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Peloton Interactive, Inc. Stock Quote
Peloton Interactive, Inc.
PTON
$13.53 (13.60%) $1.62
Johnson & Johnson Stock Quote
Johnson & Johnson
JNJ
$165.30 (-1.10%) $-1.84
Teladoc Health, Inc. Stock Quote
Teladoc Health, Inc.
TDOC
$40.32 (6.13%) $2.33
DocuSign Stock Quote
DocuSign
DOCU
$74.34 (2.77%) $2.00

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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