Things are changing pretty quickly these days, but some companies are holding up a lot better than you might assume. Some of the early-pandemic winners are still rocking. Some of the early-pandemic losers are showing signs of life.
Etsy (ETSY -0.86%), Intuitive Surgical (ISRG -1.69%), and Zoom Video (ZM -0.82%) are faring better than you probably think as businesses right now. Let's get into why the stocks will follow suit.
Image source: Getty Images.
Etsy
There's no denying that Etsy was one of the biggest beneficiaries during the pandemic lull. The online arts-and-crafts marketplace operator that had seen its revenue climb a reasonable 33% to 40% in four of the five years heading into 2020 saw its top line explode 111% last year.
The narrative on Etsy is that it sprung to life in the springtime of last year when folks were scrambling for stylish and reusable cloth face coverings. With a mask becoming an essential piece of wardrobe, why not make it unique with a little flair and personality?
The untold part of this story is that Etsy continues to thrive even now when face coverings are no longer the top draw on the platform. Crafty types with time to spare and money to make hopped on Etsy to sell their artsy creations. Etsy entered 2021 with 4.4 million active sellers, 62% more than it had a year earlier. Demand is exceeding supply, as the customer base exploded 78% to 81.9 million active buyers. Gross merchandise sales more than doubled in 2020, up 107% to hit $10.3 billion in life-altering transactions for its sellers. It's one of the biggest glow-ups over the past year in the realm of internet retail stocks.
Business remains strong long after the initial springtime scramble for one-of-a-kind pandemic-tackling accessories. Gross merchandise sales soared 118% in the fourth quarter of last year. The pace will decelerate substantially this year, but we're still looking at double-digit growth for a company that packed years of evolution and growth into a handful of quarters.
Intuitive Surgical
As Etsy's business was booming, things were going the other way for Intuitive Surgical. Hospitals bracing for an influx of COVID-19 patients and wanting to limit exposure to the catastrophic virus put elective procedures on hold. Intuitive Surgical's flagship da Vinci surgical system -- a robotic arm that performs surgeon-guided incisions -- found itself sorely underused last year. Budget-conscious hospitals also pared back orders for the big-ticket systems.
Intuitive Surgical proved mortal after years of positive double-digit growth. Year-over-year top-line growth turned negative in the second and third quarters of last year, rebounding to a modest 4% uptick in the fourth quarter. It's bouncing back in a major way in 2021.
Intuitive Surgical announced better-than-expected financial results on Tuesday afternoon. Revenue rose 18% through the first three months of this year. The number of procedures performed using da Vinci rose 16%. It saw the number of its surgical systems shipped during the quarter surge 26%. With an installed base of 6,142 machines by the end of March -- 8% more than it had a year earlier -- the year-over-year comparisons will get even kinder through the next three reports.
Zoom Video
No one is taking their Zoom room apart even as we're clawing our way out of the pandemic. Investors may have been rotating out of Zoom stock in recent months -- the stock has plummeted 45% off last October's all-time highs -- but the fundamentals aren't roughly half what they used to be six months ago.
Business is still booming for the top dog in virtual meetings. Revenue skyrocketed 326% for fiscal 2021, which concluded at the end of January, but that includes a 369% burst in its latest quarter. Some of the video-based work calls, family gatherings, and classes are changing back to in-person meetings, but the convenience of videoconferencing isn't going away. Zoom's established base of users has exploded to the point where it can withstand a dip in usage but still provide a necessary app for free and more importantly premium users. Zoom is an industry standard now, and its popularity is holding up way better than its stock price.
