National Guard COVID-19 crisis response has featured activation numbers at or near historic highs in states throughout the country and has served as an early indicator of potential stock market risks and rewards.
The National Guard COVID-19 crisis response to address a global pandemic that has claimed more than 1 million people globally and should continue once a vaccine is readied for distribution. Many market forecasters and economists look to government-generated economic data as a sign of the market’s direction, but this year the large number of National Guard activations, especially to address the COVID-19 crisis, has served as an early-warning indicator for which stocks to buy and sell.
The devastating COVID-19 pandemic has killed 1,007,769 people and caused 33,642,602 cases worldwide, with 205,998 deaths among 7,191,061 cases in the United States, as of Sept. 30. According to Johns Hopkins University, America has suffered the most deaths and cases of any country from the virus that originated in Wuhan, China.
President Trump Said the U.S. Military is Ready to Help Distribute a Vaccine
“We have the military all set up, logistically,” to distribute 200,000 doses of COVID-19 vaccine a day, said President Trump during a presidential debate against Democrat and former Vice President Joe Biden on Tuesday, Sept. 29.
The cost of the National Guard COVID-19 crisis response is mostly borne by the federal government. National Guard troops activated under Title 32 have the Federal Emergency Management Agency (FEMA) reimbursing the U.S. Department of Defense for all eligible costs outlined in the mission assignments. A Presidential Memorandum issued on Aug. 22 calls for individual states to begin paying 25% of the cost, except for Texas and Florida, which will obtain 100% federal cost share through December 31, 2020. Arizona, California, Connecticut and Louisiana continued to receive 100% federal cost share through Sept. 30, and then are subject to a 25% state cost share Oct. 1-Dec. 31.
For active duty troops providing medical support, FEMA reimburses DOD for all eligible costs. FEMA typically has required that states pay a 25% cost share for medical missions.
Low-Profile National Guard COVID-19 Crisis Response Signals Stock Market Moves
The Washington National Guard set a record in June when it activated 4,000 members, said Joe Siemandel, its public affairs officer. COVID-19 specifically has kept the guard busy since the end of March. The “biggest mission” during the COVID-19 crisis has been assisting food banks, he added.
At the height of the crisis, 2,200 members had been activated for that role, but the number subsequently has been cut to half that level, Siemandel said. The duties involve processing, packaging and distributing food.
Another important task has involved contact tracing to reach people who have tested positive or inform them that they may have been exposed and should get a test and quarantine, Siemandel said. As of late September, the Washington National Guard had assembled 1.3 million testing kits.
Once assembled, the testing kits are shipped to county emergency management officials. The activated National Guard members also moved ventilators and hospital beds between health care facilities in April, as well as delivered personal protective equipment (PPE) and disinfectant kits to senior living facilities.
The state’s National Guard also has brought COVID-19 test kits to rural counties that need them, as well as performed identification verification to assist the state Employment Security Department to avoid instances of fraud when people make claims for unemployment.
New York National Guard COVID-19 Crisis Response Signals Stock Market Moves
The duration of the pandemic response of the past seven months alone likely is the longest ever for the New York National Guard, said Col. Richard Goldenberg, a public affairs officer at the New York Army National Guard.
Gov. Andrew Cuomo mobilized the state’s National Guard on March 10 to create a COVID-19 containment zone in New Rochelle, New York, using a total of 4,456 members of the state’s Army and Air National Guard, along with the New York Naval Militia.
Jonathan Lewis, a resident of New Rochelle, said an area with a one-mile radius became a precursor to shutdowns that almost every city in America experienced within the next couple of weeks. The National Guard helped to distribute food and water out of a local high school and performed some deep cleaning of local buildings, Lewis said.
Multi-Skilled National Guard COVID-19 Crisis Response Signals Stock Market Moves
A local park, only accessible by a drawbridge, became a drive-through testing center that solely could be accessed by people who had an appointment to be tested, said Lewis, who added that he went there twice himself for testing and that the results came back negative each time. The National Guard directed traffic and checked photo IDs to confirm the people arriving there had appointments, he added.
Members of the New York National Guard established the alternate care facility at the Jacob Javits Center in New York City, staffed call centers for the Department of Health, distributed food, warehoused and distributed medical supplies, assembled test kits, supported test sites and medical examiners, as well as distributed hand sanitizers, Col. Goldenberg said. The New York National Guard had provided 480,767 man-days of support to the state March 10 through Sept. 23, he added.
Continuing National Guard COVID-19 Crisis Response Signals Stock Market Moves
Lt. Col. Brian L. Mason, public affairs officer of the Arkansas National Guard, said his state’s COVID-19 response required soldiers and airmen to assist with screening, testing, planning, analysis, warehousing and distribution, contact tracing, transportation and staffing the state veterans’ cemetery when grounds maintenance employees were quarantined. With diverse and sometimes unique skill sets, almost immediate availability and with long-standing partnerships, the state’s National Guard facilitated a unified and rapid response, he added.
“We still have nearly 40 soldiers and airmen supporting the Arkansas Department of Health and other state and local partners with the fight against the spread of COVID-19, and we will be there for as long as we’re needed,” Lt. Col. Mason said.
The total cost, as of Sept. 10, hit $1,856,010.05, Lt. Col. Mason said. There have been some smaller water-support missions that have been ongoing for quite some time which would add another $750,000 to the total, he added.
As it stands, the COVID-19 and other missions are currently under the federally approved disaster declarations, so the reimbursement is 75% federal dollars, with the state responsible for other 25%.
“We have certainly reached the high-water mark for State Active Duty missions in terms of longevity,” Lt. Col. Mason said. “No other previous mission has gone on longer.”
Arizona National Guard COVID-19 Crisis Response Signals Stock Market Moves
The Arizona National Guard was activated by the state’s governor on March 19, 2020, and has supported more than 3,880 missions related to its COVID-19 response, totaling more than 247,000 hours. Approximately 750 citizen-soldiers and airmen currently are assigned to its COVID-19 support mission.
In mid-June, the Arizona National Guard had more than 2,500 Guardsmen activated, reaching the highest number for domestic responses at any one time in the state’s history, said 2nd Lt. Wes Parrell, deputy state public affairs officer of the Arizona National Guard Joint Force Headquarters. The number includes service members supporting COVID-19 response efforts, civil support to law enforcement and support to U.S. Customs and Border Patrol on the state’s Southwest Border Mission.
“This is also the longest continuous activation of our State Emergency Operations Center,” 2nd Lt. Parrell said. On Sept. 11, the Arizona National Guard reached six months of continuous service, he added.
Georgia National Guard COVID-19 Crisis Response Signals Stock Market Moves
The Georgia Department of Defense moved in one month from contingency planning for COVID-19 operations to 10 different missions at locations across the state. Georgia National Guardsmen have provided medical, logistical and security support across the state to increase testing of COVID-19.
Soldiers of the Atlanta-based Company C, 3rd Battalion 121st Infantry Regiment assist an infection control team in disinfecting a nursing home in Plains, Georgia. Photo courtesy of the Georgia National Guard
Stock Picker Knows National Guard COVID-19 Crisis Response Signals Stock Market Moves
Stock picker Jim Woods is a former U.S. Army infantryman and paratrooper, who also spent a number of years in the National Guard, so he has firsthand knowledge of what citizen-soldiers face when called into an emergency situation.
Paul Dykewicz discusses stocks with Jim Woods before COVID-19 strikes.
Woods is recommending Johnson & Johnson (NYSE:JNJ), which offers a current dividend yield of 2.75% and is among the companies testing what could become one of the first COVID-19 vaccines available. Johnson & Johnson has many revenue sources and that may help it to hold its value, even if the market drops. Plus, headlines of vaccine progress have been “very encouraging,” Woods wrote in the October 2020 issue of his Intelligence Report investment newsletter.
“It is now reasonable to believe that we will have at least one approved COVID-19 vaccine… before Election Day,” Woods opined.
The approval would come in the form of an Emergency Use Authorization. Not only has the Trump administration been signaling positive developments, but so have the heads of the big pharmaceutical companies that are developing and testing the urgently needed vaccines, noted Woods, who also writes the Successful Investing newsletter and the Bullseye Stock Trader advisory service.
Chart courtesy of www.stockcharts.com
Teladoc Soars Amid National Guard COVID-19 Crisis Response That Signals Stock Market Moves
For those seeking a pure play on COVID-19, flu season and the explosion of remote medicine, look no further than Teladoc Health Inc. (NYSE:TDOC), said Bryan Perry, who leads the Cash Machine investment newsletter and the Premium Income, Quick Income Trader, Breakout Profits Alert and Hi-Tech Trader advisory services. As the largest publicly traded virtual health care provider, TDOC is poised to gain further institutional ownership in the months ahead.
Paul Dykewicz interviews Bryan Perry about investing at a MoneyShow.
The stock is up 16.01% during the past three months and 159.60% so far this year. On Sept. 21, the D.A. Davidson investment firm launched coverage on Teladoc Health Inc. with a Buy rating, while citing the company’s rapid growth rate and expanding market due to the pandemic.
“This is a pure play software company directly benefiting from COVID-19,” according to D.A. Davidson. “As a result, the company is growing over 60% organically, and the additions of acquisitions have further expanded markets and provided leverage to popular direct to consumer markets.”
Chart courtesy of www.stockcharts.com
Teladoc announced the acquisition of health care data provider Livongo Health Services Inc. (LVGO) on Aug. 5 for $18.5 billion to create a virtual health care juggernaut with tremendous long-term growth potential, Perry said.
D.A. Davidson Recommends Teladoc as a Stock to Buy Amid the COVID-19 Crisis
Historically, overall telehealth use rates have been below 1%, but Teladoc soared to 16% during COVID-19 and could rise to 25% long term. Based on a McKinsey study, such growth could equate to a $250 billion market going forward.
“Patient demand has gone up and the reimbursement for telehealth visits is getting much easier thanks to favorable telehealth regulations,” according to the D.A. Davidson report. Teladoc has been building a competitive moat to protect its business by completing 11 acquisitions, not including its pending deal to acquire control of Livongo to add millions of new members and a new class of disease monitoring.
“Competitively, no other company has the scale and depth of solutions of Teladoc and we expect the company to remain firmly ahead of the curve as it continues to grow both organically and inorganically,” according to D.A. Davidson. Conservative third-quarter 2020 guidance positions Teladoc to beat analysts’ earnings forecasts.
National Guard COVID-19 Crisis Response Signals Stock Market Moves as Risk of Second Wave Rises
Still in fast-growth mode, money-losing Teladoc’s financial guidance did not fully reflect a worsened disease spread of COVID-19 that has materialized since its earnings call, according to D.A. Davidson. Roughly 80% of Teladoc’s total revenue comes from the United States.
Total 3Q revenue is projected to grow 18% quarter over quarter and a whopping 106% year over year.
National Guard COVID-19 Crisis Response Signals Stock Market Moves as a Vaccine is Readied
Hilary Kramer, host of a national radio program called “Millionaire Maker” and head of the GameChangers and Value Authority advisory services, said the National Guard always has been essential when it comes to enforcing quarantines and then relieving the “economic dislocations” of a health crisis.
Kramer, whose premium advisory services include 2-Day Trader, Turbo Trader, High Octane Trader and Inner Circle, said the National Guard’s initial response to COVID-19 was extremely robust. But now that the testing programs are in place and personal protective equipment (PPE) supply centers are stocked, attention has shifted to managing local outbreaks when they happen, she added.
“When a vaccine is ready, the Guard will probably help distribute the shots as they have for centuries,” Kramer said. “But for now, as the Guard steps back, areas of the economy that bore the brunt of the crisis have space to heal. That’s where the investment opportunities are.”
Columnist Paul Dykewicz interviews money manager Hilary Kramer.
Once travel normalizes, it could be a good opportunity for stocks such as Air Lease Corp. (NYSE:AL) and business development companies like Apollo Investment Corp. (NASDAQ:AINV) that have significant interests in business travel, Kramer said. Nonetheless, this business might take years to fully recover, but with the stocks at reduced levels, the most important factor could be that they already have hit bottom.
“The worst is over, and any improvement will come as an enormous relief,” Kramer said.
Chart courtesy of www.stockcharts.com
Air Lease trades at a modest valuation of a 5.25 consensus forward price-to-earnings (P/E) ratio while offering a 2.05% dividend yield. The stock also is traded at a relative discount after eking out a 0.06% gain in the past three months, following a 27.45% year-to-date loss.
Chart courtesy of www.stockcharts.com
Apollo Investment Corp. (NASDAQ:AINV) pays an eye-popping dividend yield of 14.99% after its share price dropped amid the COVID-19 crisis. Its consensus forward P/E ratio of 4.81 is about as low as investors realistically can expect it to go. The stock has fallen 8.63% during the past three months and 45.42% so far this year.
National Guard COVID-19 Crisis Response Signals Stock Market Moves, with Gold Shining as a Refuge
Bob Carlson wrote in the October 2020 issue of his Retirement Watch investment newsletter that he still is “riding gold’s rally” in his “Invest with the Winners” portfolio.
“In this portfolio, I use several investment models to analyze the performance of a group of ETFs that represent the major investment classes,” Carlson explained. “The models seek to identify the one ETF that has had strong recent performance and seems likely to continue that performance for a while. In the past, the portfolio has traded ETFs every two or three months.”
Pension fund Chairman Bob Carlson answers questions from Paul Dykewicz in an interview before social distancing became the norm after the COVID-19 outbreak.
The investment models identified iShares Gold Trust (IAU) as the exchange-traded fund (ETF) to buy in early January and it has held the top spot ever since, said Carlson, who also is chairman of the Board of Trustees of Virginia’s Fairfax County Employees’ Retirement System with more than $4 billion in assets. Even though IAU does not pay a dividend, it is up 6.97% for the past three months and 24.90% thus far in 2020.
Chart courtesy of www.stockcharts.com
Income investors may like pharmaceutical giant Pfizer (NYSE:PFE) and its 4.20% dividend yield. It is one of the companies developing and testing a vaccine for the coronavirus. It also trades at a modest consensus forward P/E of 11.76.
Pfizer provides a “great opportunity to profit” with a stock that offers a “high-dividend” yield, said Mark Skousen, PhD, a presidential fellow at Chapman University who recommends the position in his Forecasts & Strategies investment newsletter. Skousen, who also heads the Home Run Trader, TNT Trader, Five Star Trader and Fast Money Alert trading services, features the stock among his five favorite undervalued, dividend-paying recommendations.
Pfizer Inc. has notched a total return of 11.98% during the past three months, rebounding from a year-to-date loss of 4.77%.
Chart courtesy of www.stockcharts.com
China’s lack of transparency about the initial severity of the COVID-19 crisis that began there has hurt its relationship with President Trump and other U.S. leaders. As President Trump indicated in the Sept. 29 presidential debate, members of the U.S. military are prepared to help distribute a COVID-19 vaccine as soon as U.S. regulators approve it on an expedited basis.
Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul, who can be followed on Twitter @PaulDykewicz, is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The book is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many others.