The work-from-home (WFH) phenomenon has faded tremendously, as many companies, large and small, are ordering their employees to spend at least a few days per week in the office. For example, JPMorgan (NYSE:JPM), Apple (NASDAQ:AAPL) and video game maker Activision Blizzard (NASDAQ:ATVI) are among the huge companies ending or greatly curtailing WFH privileges. As a result, many companies that benefited from the WFH trend are taking sizeable hits to their top and bottom lines. Although the increase in interest rates is certainly the main reason the demand for single-family homes has dropped tremendously, I believe the demise of the WFH trend has also played a sizeable role in causing the demand for such houses to decline. After all, the situation in which many workers from high-tax states could live anywhere in the country and still keep their jobs is over. I believe the latter situation, in turn, has caused the demand for houses in many low-tax states to drop a great deal. Finally, the demand for many types of computer hardware and software previously used by employees working from home has declined. Here are three work-from-home stocks to sell.
Zillow (Z)
Zillow (NASDAQ:Z) provides advertising to real estate agents and originates mortgages. In October 2023, the company itself reported worker interest in “work-from-home zones” like a “cloffice” (a combination between a closet and an office) or a Zoom room sunk significantly.
Not coincidentally, I believe, Zillow’s operating income in the 12 months that ended in September 2023 came in at -$227 million, down from -$69 million in all of 2022 and $259 million in all of 2021.
Also noteworthy is that the firm’s residential revenue sunk to $362 million in the third quarter from $372 million during the same period a year earlier.
Although the company will be helped somewhat by a likely decline in interest rates in 2024, lower prices and the continued demise of the WFH trend will, I believe, combine to push Z stock down this year. Consequently, I view it as one of the top work-from-home stocks to sell.
Apple (AAPL)
Apple benefited in multiple ways from the WFH trend. People who spend much more time at home tend to be more focused on software, including Apple TV, Apple Music and Cloud services — the company’s Services sector.
In the second quarter of 2021, for example, the tech giant’s revenue from Services soared 33% versus the same period a year earlier. Conversely, in the quarter that ended last September, Apple’s Services revenue climbed 8.2% year-over-year.
WFH also boosted Apple’s hardware sales, as employees bought many more devices to use from home. In the quarter ending in September 2021, its revenue from iPads came in at $8.3 billion. In the quarter that ended in September 2023, the device only generated $6.4 billion in sales. Meanwhile, its Mac revenue dropped from $9.1 billion to $7.6 billion.
With the WFH trend further eroding, so will Apple’s top and bottom lines, along with AAPL stock.
Zoom Video (ZM)
With the WFH trend winding down, videoconferencing provider Zoom Video (NASDAQ:ZM) has found growth hard to come by. For example, in the third quarter of last year, its top line only increased 3% versus the same period a year earlier.
That makes sense, since, as WFH winds down, companies are utilizing more face-to-face meetings and fewer Zoom sessions.
Moreover, Microsoft’s (NASDAQ:MSFT) Teams software reportedly caught up to Zoom’s offerings in terms of functionality, leaving Zoom vulnerable to market share losses.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.