Five hot stocks to hold in 2021

In the turbulence of the current global situation, playing the stock market can be fraught with risk. Yet despite this, the stock market in 2020 ended up with gains.

Some of the companies that suffered throughout 2020 may be surprising to many and include giants like Apple, whose value fell by 7% despite fantastic sales figures, and Amazon, whose value fell by 4% despite lockdowns and the limitations placed on traditional retail outlets.

Strange days, and it is these uncertainties that can make choosing the right stock to hold onto during 2021 a lottery. In this article, I set out to consider 5 stocks that could offer ample rewards in the year ahead.

1 Walt Disney

This may seem counterintuitive, the global pandemic shut down, or limited many of the entertainment giant's theme parks and experiences. Indeed, despite many parks now reopening, albeit, at reduced capacity, revenue was down 53% in figures reported at the end of the first fiscal quarter, which ended on 2nd January.

But every cloud has a silver lining and despite the massive slump in sales in the theme park sector, Disney shares still soared, fed by the massive uptake in their streaming services which include Hulu, ESPN, and Disney+. All reported massive gains, in the latter case Disney+ subscriptions had a year-over-year increase of 250%.

With the world preparing to open to travel again, Disney is likely to be in a position to take advantage of the surge in holidaymakers.

2 Diageo

Another company that has a business core that has been affected badly by the global pandemic. The group is one of the world’s leading distillers and has such brands as Johnny Walker, Bailey’s, Gordon’s Gin, and Smirnoff under its umbrella.

Sales of these products took a massive hit during the pandemic, but the company is still well-placed when the recovery kicks in and society returns to normal. With fantastic figures showing operating margins were above 25% each year in the decade leading up to 2020, there is no reason to expect that this will not be the situation again as the world normalizes.

3 Roku

The pandemic fueled massive growth in the uptake of streaming services and Roku quickly capitalized on this. Roku is a manufacturer of streaming devices and their devices currently hold the top spot in US sales of such devices, with 38% of the market.

But this is just one of the income streams that Roku boasts, they also get revenue from advertisers for its free streaming services and from its subscription services. In 2020 they added 14 million active accounts and the average user spend rose by 24%.

Roku stock rose an astonishing 358% over the last year and has risen a further 13% in the current year.

4 Facebook

Facebook is another company that has bucked the trends over the last year. With an income that is close to 100% based on advertising revenues and a predicted slump of 7.4% on advertising spending as the world struggles to cope with the economic downturn caused by the pandemic, you would be forgiven for thinking that Facebook would be similarly affected.

Instead, they have reported that sales during the pandemic rose by 10%, the bulk of these sales have been through the Facebook platform itself, but increasingly they are monetizing platforms like WhatsApp and Instagram.

Despite large capital investment in data centers and network infrastructure, Facebook still ended the year with $20 billion in free cash.

5 Fiverr International

Another consequence of the global pandemic was how many of us worked. With freelancing and the gig economy already on the rise, the pandemic added fuel to the fire, and Fiverr is ideally placed to capitalize on this.

The freelancing platform that allows freelancers to sell their digital services has seen a massive growth of sales over 2020, topped by a fourth-quarter growth of an astonishing 89%.

With plans to expand into new sectors soon, and the gig economy only going to grow, this is really one to watch. In 2020 Fiverr stock grew by 580% and this year it is up another 11%, it is fair to say that this trend is set to continue.