Global share markets are becoming increasingly volatile as investors try to price in the impacts of the coronavirus pandemic. At the same time, governments are trying to inject money into the economy through enormous stimulus packages. Combined, these twin forces are causing enormous daily swings in the market.
Just look at the Afterpay Ltd (ASX: APT) share price. Over the last 5 trading days, it has posted daily gains of over 25% three times and had two days in which it had lost over 20%.
The share price of Corporate Travel Management Ltd (ASX: CTD) has seen similar swings recently. Last Thursday, it fell almost 30%, then rose 19% on Friday, and shot up over 30% on Tuesday.
These aren’t penny stocks. Both companies are in the S&P/ASX 200 Index (ASX: XJO). These sorts of swings just don’t happen in a normal market.
What this really shows is that investors have no idea how to value these companies right now. But it also demonstrates how important it is to continue to maintain a long-term view of your portfolio.
Daily updates on the pandemic, as well as the efforts governments are making to halt its spread, will continue to drive volatility on the markets for weeks, if not months. So, try to see through that short-term volatility to look for real growth, value and opportunity in the market.
Bigtincan Holdings Ltd (ASX: BTH)
Bigtincan is a software company that uses artificial intelligence techniques to help companies boost their sales numbers through end-to-end process enhancements. For example, it helps deliver better, more targeted training to staff members. It also helps to streamline the sales process by automating many manual tasks.
The company is responding well to the coronavirus pandemic. In a market update made on Friday, Bigtincan reaffirmed its full-year guidance of 30% to 40% organic revenue growth. Its workforce is already experienced in working remotely, and much of its revenues are from recurring subscription-based services.
LiveTiles Ltd (ASX: LVT)
LiveTiles has underperformed recently, with its share price sinking over 50% lower so far in 2020 (at the time of writing). However, LiveTiles’ underlying performance continues to be strong. Annualised recurring revenues for the first half of FY20 rose 130% against 1H19 to $52.7 million, and its customer numbers almost doubled to 1,031.
LiveTiles develops intranet portals for corporate clients. It uses artificial intelligence and machine learning to create interactive online working environments, with the aim of boosting employee productivity and engagement.
As more companies across the globe are transitioning to working remotely, there may even be a spike in demand for engaging and collaborative online workspaces.
Dubber Corp Ltd (ASX: DUB)
Dubber is another software-as-a-service company making use of artificial intelligence and machine-learning techniques. However, it specialises in call recording and analysis, helping companies increase customer satisfaction and call centre productivity.
Earlier this month, Dubber announced that its core operations were unaffected by the developing coronavirus pandemic. In fact, as many companies transition to remote working arrangements, there may even be new commercial opportunities for cloud-based call recording software.
These companies are still potentially risky and speculative bets, each with market caps of only a little over $100 million. However, each is well suited to survive, and even thrive, in an economy which is being forced to transition to online over the next few months.
They also provide long-term growth prospects in an economy that may be forever changed – and not necessarily for the worse – by the impacts of the coronavirus pandemic.
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As of 17/3/20
Motley Fool contributor Rhys Brock owns shares of AFTERPAY T FPO, Dubber Ltd, and LIVETILES FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO and Corporate Travel Management Limited. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended LIVETILES FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.