The global pandemic hit few companies harder in 2020 than IAG (LSE:IAG). Covid-19 and the economic downturn managed to wipe out thousands of jobs and billions in revenue. The outlook for 2021 is uncertain too.
The IAG share price was one of the biggest losers of 2020, which is why I am avoiding it and looking elsewhere to bolster my portfolio.
IAG share price woes
On 4 January 2020, I could purchase IAG for 454p per share. As I write, the IAG share price is hovering near 140p which is close to a 70% decrease in value. The global pandemic grounded planes and placed billions across the world in lockdowns. Public health measures included severe travel restrictions for months on end which decimated the airline industry.
While 2020 was a year to forget, there is a chance 2021 could be better. Personally, however, I am not convinced right now.
The IAG share price did receive a boost in November. At that time, successful Covid-19 vaccine results provided a rare spark for the whole of the stock market. In addition, the British Airways owner also has a resilient balance sheet which could help in 2021 and beyond.
However, a number of new strains of Covid-19 have caused further setbacks for IAG and the airline industry. Also, the UK will not complete its vaccine rollout until at least September. This means a summer holiday may be out of the question and impact airlines further. The IAG share price is currently on my no fly list.
FTSE 100 stock flying high
Ocado Group (LSE:OCDO) was one of the top performers for 2020. Its share price nearly doubled and trading levels increased exponentially due to the pandemic. In fact, its share price over the past five years has risen nearly 850%! The online food shopping firm has seen a huge increase in trading due to the lockdown, which I believe could continue into 2021.
In its most recent trading update in December for Q4, Ocado showed an average of 360,000 orders per week. This is a 3% growth over the same period last year. In turn, revenue grew by close to 35% compared to the same period. This reporting period was before the third lockdown was announced. The addition of selling Marks & Spencer food through its retail division and unprecedented demand across its services has led Ocado to bolster its full-year profit forecast by an additional £20m and potentially more. It is also expanding into clothing and general merchandise too, which I believe is the first step towards global expansion.
I must admit that OCDO shares are expensive, currently trading at 2765p as I write, unlike the beleaguered IAG share price. However Ocado is priced for global growth at a rapid speed. This does mean any setbacks that occur may hit hard so that must not be ignored.
Ocado over IAG
The IAG share price isn’t of interest to me right now and I wouldn’t even view it as a contrarian buy. I will still keep an eye on developments, however. Instead, for 2021 and beyond, I see Ocado growing further and continuing its impressive rise. In addition to Ocado, here is a stock I see making me a passive income too.