Forget This Popular Work-From-Home Trade. I’ve Found A Better One…

Over the past few months, we’ve seen some interesting trends in the stock market. As many people were forced to work and attend school from home, stocks of some of the companies supporting those tasks delivered gains.

One example is Zoom, which has been one of the most popular platforms for hosting video conference calls between co-workers, friends, and even family events. Once the first “stay at home” orders were issued, Zoom quickly became a household name.

As you can imagine, investors clamored to get in on the trend… which you can see in the chart below for Zoom Technologies, a company that had the symbol ZOOM when the shutdown began. Notice how the stock soared 1,900% as investors looked to cash in on Zoom conferences.

Actually, the chart above offers an important lesson. You see, this wasn’t the “Zoom” traders meant to buy. This Zoom, according to the company, “does not have significant operations. Previously, it distributed wireless communication products in the United States. The company is headquartered in Beijing, China.”

After uninformed traders lost millions of dollars, the company changed its symbol and the stock is now trading under a dollar.

Here’s the correct Zoom Video Communications, Inc. (NASDAQ: ZM). It’s up near nearly 300% since the beginning of the year.

All other incidents aside, ZM is a challenge to analyze. The company will benefit from changes to the workplace, but it’s difficult to determine how much will change and for how long. Many companies will return to offices at least part time, and that will reduce the demand for Zoom conferences, which will affect stock prices.

A Better Way To Profit From Work-From-Home

However, there’s another quarantine hero that has caught my eye… and there’s no question this company will continue to benefit when the economy reopens. That company is DocuSign, Inc. (NASDAQ: DOCU).

You may already be familiar with this company. You might have used its services yourself… Or you may have read my colleague Jimmy Butts recently talk about how he and his followers cashed out a 110% gain on the stock.

DocuSign offers eSignature services. Its products allow customers to sign electronically “on practically any device, from almost anywhere, at any time. Today, more than 660,000 customers and hundreds of millions of users in over 180 countries use DocuSign to accelerate the process of doing business and to simplify people’s lives.”

This is a company many firms use to process contracts, employment paperwork, or any kind of form requiring initials and a signature. Like I said, you’ve likely already used this company’s services. Some of its customers are shown in the chart below which was in a recent investor presentation.


Source: DocuSign

DocuSign is what I like to call a “field of dreams” company that follows the idea of “build it and they will come.” It took time to create the process and build the infrastructure. At the beginning, that resulted in losses, and the company is just now turning profitable after four years of losses. Earnings are expected to grow quickly, with earnings per share (EPS) growth expected to average 73% in the next year.

How I’m Trading DOCU

Over the next five years, earnings growth is expected to be in the top 6% of all published estimates. But, it’s within reach since each new customer now adds directly to the bottom line. That’s because the infrastructure is in place. The company built it, and now the profits will come.

As the economy reopens, many customers will continue to rely on DOCU, and processes long done in person, including real estate transactions, could be moving online.

Investors could simply buy the stock and hold for the long run. But on closer examination, the stock might be expensive for long-term investors. Fortunately, it does provide an attractive short-term income opportunity for us over at Income Trader.

I recently recommended a trade that will allow us to collect a quick 4.1% gain in the stock in only 38 days. If we can repeat a similar trade every 38 days, we will earn about 39% on our capital in 12 months.

Editor’s Note: My colleague Jimmy Butts recently found something else that could make you a fortune in 2020…

While digging through SEC documents, he found a small item in the filings of a little-known satellite technology company. And the implications are huge…

It turns out this company paid a measly $26 million for a tech startup it bought in 2019. That’s an amazing price, but it’s just a small fraction of what they received for their $26 million. And it could amount to the most lucrative opportunity we’ve come across in years…

Go here to read our special report right now…