The COVID-19 omicron virus is now the most dominant coronavirus variant in the United States. And although omicron’s severity is still unclear, its broad transmission has been fast, worrying leaders who are exploring options to restrict its spread. Given this backdrop, we think it could be wise to avoid brick-and-mortar stocks Dollar General (DG), Tractor Supply (TSCO), and Five Below (NASDAQ:FIVE). Read on.Cases of COVID-19 infections are on the rise again. European countries were the first to bear the brunt as countries like Netherlands and Austria imposed lockdowns. Meanwhile, in South Africa, reports of a new variant made headlines because it was believed to be more transmissible and infectious than the Delta variant. The WHO named the new variant, omicron, a variant of concern on November 26, 2021.
The omicron variant has been detected in more than 89 countries. And according to the WHO, cases are doubling every 1.5 to 3 days with community transmission. A minor breakthrough has been made in gauging the severity of the variant. But it is still unclear whether current vaccines are entirely effective against it. The WHO has warned that with cases rising so rapidly, hospitals may soon be overwhelmed in some places. Although President Joe Biden made it clear that full lockdowns are out of the question, the fear of partial restrictions remains.
As omicron variant cases surge, it could lead to lower foot traffic at brick-and-mortar retail stores. So, we think it could be wise to avoid brick-and-mortar retail stocks Dollar General Corporation (NYSE:DG), Tractor Supply Company (NASDAQ:TSCO), and Five Below, Inc. (FIVE). They also look overvalued at their current price levels.