Although the overall economic outlook tends to be mostly gloomy these days, there are still plenty of companies on the ASX that are well suited to a new coronavirus economy.
This "new normal" of remote working arrangements and social isolation is creating a unique set of demands. Businesses are becoming more reliant on communications software and technology infrastructure to support drastically different working environments.
Here are 5 ASX shares that I think are best suited to meet these changing circumstances, and can provide much-needed support for a society trying to navigate an unprecedented global healthcare crisis.
MNF Group Ltd (ASX: MNF)
ASX technology and telecommunications company MNF Group provides software solutions perfectly tailored to meet the demands of businesses that are attempting to work remotely. The company specialises in Voice over Internet Protocol (VoIP) technology, which is a way to convert analogue audio signals into digital data that can be sent over the internet. VoIP can be used for teleconferencing, virtual meetings and digital data transfers.
No wonder it is continuing to grow even as the coronavirus cripples large sections of the economy. Just last week, MNF Group reaffirmed its full-year guidance for earnings before interest, tax, depreciation and amortisation (EBITDA) of between $36 million and $39 million.
Xero Limited (ASX: XRO)
Shares of cloud-based accounting software provider Xero have rallied strongly recently, but at $77.50 they are still a bargain compared to their pre-coronavirus high of $90.22. Xero has been one of the best growth shares on the ASX for a long time now, even forming part of the coveted (and media-friendly) 'WAAAX' group of companies.
Xero should continue to generate good short-term revenues, particularly now that the JobKeeper legislation has been enacted by the government. This means that even small businesses in lockdown will still need to manage their payroll and submit FY20 tax statements.
NextDC Ltd (ASX: NXT)
Another ASX company rising to meet the changing demands of a pandemic economy is data centre operator NextDC. Back in March, the company reaffirmed its full-year guidance for underlying EBITDA of between $100 million and $105 million. It reported that there had been no material change to its sales pipeline, and instead acknowledged the likely increase in demand for NextDC's technology support services as more companies transitioned to working from home arrangements in response to COVID-19.
The NextDC share price gained over 5% in the last week on the back of the announcement of a number of new material contract wins at its Victorian data centres.
Objective Corporation Limited (ASX: OCL)
ASX technology company Objective Corporation develops software specifically designed to support the government and financial services sectors. Given that the company's products are targeted towards sectors which will continue to be relied upon heavily throughout the coronavirus pandemic and beyond, an investment in Objective Corporation has both growth and defensive characteristics. These are 2 key attributes for a resilient portfolio.
Since falling to around $4.40 a share in mid-March, Objective Corporation shares have soared almost 40% higher to $6.12 as at the time of writing, and are not far off their pre-coronavirus levels.
Appen Ltd (ASX: APX)
Cloud-based artificial intelligence and machine learning company Appen has long been a market darling. However, as more companies adjust to working remotely and seek to simplify and streamline cumbersome processes, Appen's data solutions will become increasingly in demand.
I believe the company is well-positioned for success in a post-coronavirus economy. Despite all the recent market turbulence, the Appen share price is up close to 13% so far this year to $25.35 as at the time of writing.
