There has been ample discussion surrounding the rise of remote working as scores of companies have ordered employees to work from home, and how this has resulted in an impressive boost to the technology sector.
However, with hundreds of thousands of schools and universities shut worldwide and e-learning becoming the new normal, the phenomenon of 'learning from home' is not to be discounted by investors.
We cannot pretend that the unique situation that is the Covid-19 outbreak has not hit the education sector hard. Education companies are mostly counter-cyclical assets with defensive attributes that should normally be resilient in time of economic recession.
But this time, they were the first to be impacted by the outbreak. To cite just a few examples, with the closure of education facilities most service providers, which includes the likes of catering and transport companies, have been severely affected (albeit if only temporarily).
In addition, with borders shutting down, visibility on international student exchange programmes is getting increasingly low. Even student loan companies experienced a temporary blow in March as interest and principal payments have been put on hold by US President Donald Trump.
Zooming to the future
However, the education space still offers profitable pockets of opportunity for investors willing to look beyond prescribed learning and instead unearth the learning tools of tomorrow (or indeed of today).
It goes without saying that computers and peripherals are in high demand and are currently enjoying sales growth as social distancing takes hold and education moves online.
However, the same can be said of software and collaboration tools designed to support e-learning. Services offered by the likes of Microsoft, Zoom Video and Slack are now more popular than ever as students engage with their professors and tutors (as well as each other) remotely.
Take for instance Microsoft's Teams collaboration tool and Skype video conferencing. Skype's average daily users are up 40 million, while calling minutes were 220% higher month-on-month in March.
Consequently, we are witnessing unprecedented demand for Skype's competitor, Microsoft Teams, which recently passed the 44 million daily active users mark, up from 20 million in November 2019.
Zoom, the hugely popular video conferencing app, announced last month its daily active users surpassed the 200 million mark, compared to a peak of ten million at the end of December.
Meanwhile, Alphabet's Google Chromebooks, as well as its productivity and collaboration software, are being used by millions of students globally.
Last month, equity research analysts at William Blair published a note indicating they are expecting big upside for education technology (EdTech) companies as schools move towards online learning for the next month or two.
Chegg is one name in particular that has been touted as a big winner. Chegg is an American EdTech business offering a services platform directly to students, enabling them to purchase or rent digital or hard copy schoolbooks at competitive prices, as well as individual tutoring facilities.
In 2018, Chegg exceeded three million subscribers to its online services, up 38% compared with the previous year; this is a trend that is only set to accelerate as students adapt to the current predicament.