VTWO - Short-Term Uncertainties As COVID-19 Cases Spike

• In the near term, we continue to expect a seasonal upsurge in COVID-19 cases to impact consumer behavior. Where hospitals are nearing capacity, an unwelcome return to local and regional lockdowns may still be necessary.
• Increased lockdowns will likely perpetuate the goods versus services divergence within economies, as restrictions continue to impact many high-touch services, while essential goods see high demand. It is even possible that GDP will experience a negative reading in the fourth quarter of 2020.
• Given optimism over fiscal support and an eventual victory in the fight against the virus - bolstered by ample liquidity to soothe markets in the interim - equity investors may choose to look through any near-term hit to revenues.

For further details see: