The first quarter of 2021 has been a lively period for stock market investors. Early on in the quarter, growth shares outperformed with stocks like Tesla, PayPal, and Shopify rising to new all-time highs. In the second half of the quarter, however, concerns about inflation and rising bond yields have hit growth shares, and investors have moved money into ‘reopening’ stocks such as Marriott International, EasyJet, and Carnival. 

Your capital is at risk. Other fees apply.

Stocks to watch in Q2 2021

In Q2, the reopening of the global economy could remain a dominant theme. As vaccines are rolled out and lockdowns are eased, many companies will see their revenues and earnings pick up, particularly those that have been significantly disrupted by Covid-19 restrictions. Investors shouldn’t forget about stocks in growth industries such as e-commerce, cloud computing, and digital payments, however. These kinds of industries are only going to get bigger in the years ahead as the global economy undergoes digital transformation.

5 top stocks to consider now

In this guide, we look at five top stocks to consider for Q2 2021. The stocks are:

  • Alphabet
  • Mastercard
  • L’Oréal
  • ASOS
  • Starbucks

All of these companies could benefit from the reopening of the global economy in the months ahead and are expected to grow in 2021. Yet at the same time, they are all poised to benefit from powerful digital trends in the long run.

Alphabet (GOOG)

Google stock chart
Past performance is not an indication of future results. Your capital is at risk.

  • Alphabet is the owner of Google and YouTube – the two most popular websites globally. It is the largest digital advertising company in the world and the third largest player in the cloud computing market.
  • In the short term, Alphabet should benefit as businesses increase their advertising budgets post-Covid-19. A rebound in travel-related ads could boost revenues significantly.
  • In the long run, the company is well placed to benefit from the growth of the digital advertising market. This market is expected to grow to $980 billion by 2025, up from $304 billion in 2019 so there’s substantial long-term growth potential here.
  • Alphabet is seeing strong growth in many areas right now. YouTube ad revenues, for example, were up 46% year on year in Q4 to $6.9 billion. Cloud revenues, meanwhile, increased 47% year on year to $3.8 billion. Overall, total group revenue in Q4 was up an impressive 23% year on year. Looking ahead, analysts expect top-line growth of 23% in 2021.
  • Next earnings release: Q1 results, 28 April 2021

Your capital is at risk. Other fees apply.

Mastercard (MA)

Mastercard stock chart
Past performance is not an indication of future results. Your capital is at risk.

  • Mastercard is a global technology company that provides transaction processing services.
  • Mastercard was impacted by Covid-19 in 2020 as it generates a large proportion of its revenues from travel spending. ‘Cross-border’ payment volume was down 29% year on year, pushing overall revenue 8% lower. As the global economy reopens in the months ahead and the travel industry picks up, cross-border payment volume should increase significantly.
  • In the long run, Mastercard looks set to benefit from the shift towards electronic payments. By 2030, around 2.7 trillion transactions globally are expected to move from cash to credit cards and e-payments according to Accenture.
  • Mastercard recently announced that it will start supporting cryptocurrencies on its network. This will create a lot more possibilities for shoppers and merchants. The company is also actively engaging with several major central banks, as they review plans to launch new central bank digital currencies (CBDCs), to offer citizens a new form of money.
  • Next earnings release: Q1 results, 4 May 2021

Your capital is at risk. Other fees apply.

L’Oréal (OR.PA)

L’Oréal stock chart
Past performance is not an indication of future results. Your capital is at risk.

  • L’Oréal is the world’s largest cosmetics company. Its brands, which include L’Oréal Paris, Maybelline New York, and Garnier are sold in over 150 countries worldwide.
  • L’Oréal’s sales held up well during Covid-19. The group returned to growth in the second half of 2020 with Q4 sales rising 4.8%. Online sales surged 62% in 2020, rising to 27% of total sales. The company believes that online sales can grow significantly from here.
  • Chairman and CEO Jean-Paul Agon predicts a ‘fiesta’ for makeup and fragrances when lockdowns end and pent-up people are allowed to socialise again.
  • Sales in China were up 27% in 2020. Consumer demand for higher performance and superior product quality continued the premiumisation trend while various promotional campaigns stimulated growth.
  • Since L’Oréal’s Q4 results, a number of brokers have increased their price targets for the stock.
  • Next earnings release: Q1 results, 15 April 2021.

Your capital is at risk. Other fees apply.


ASOS stock chart
Past performance is not an indication of future results. Your capital is at risk.

  • ASOS is a UK online fashion retailer that has 25 million active customers globally. Its vision is to become the number one destination for fashion-loving 20-somethings worldwide.
  • ASOS is benefitting from the shift to online shopping. For the four-month period to 31 December 2020, total retail sales were up 24% with growth in the UK up 36% year on year. The company advised that FY2021 profit before tax is likely to be at the top end of market expectations.
  • The online fashion retailer recently announced the purchase of the Topshop, Topman, and Miss Selfridge brands from Arcadia group for £265 million. These are well-known brands that are likely to resonate well with its core customer base. The group believes these acquisitions will be accretive to profit margins and result in a double-digit return on capital in the first full year (FY2022).
  • As lockdowns are eased in 2021 and people begin socialising again, demand for party wear should rise. This should benefit ASOS.
  • ASOS’s valuation is significantly lower than that of German rival Zalando at present. This suggests the stock could be undervalued.
  • Next earnings release: H1 results, 8 April 2021

Your capital is at risk. Other fees apply.

Starbucks (SBUX)

Starbucks stock chart
Past performance is not an indication of future results. Your capital is at risk.

  • Starbucks is the world’s largest coffee chain. Globally, it operates around 30,000 stores in more than 80 countries.
  • Starbucks, which prides itself on being a gathering place, should benefit as vaccines are rolled out and people seek to catch up with their friends in the months ahead. “We are here for that great human reconnection,” CEO Kevin Johnson said recently. “Starbucks was built for this moment.”
  • One of Starbucks’ competitive advantages is its ‘Rewards’ programme. This programme, along with the Starbucks app, gives the coffee chain the ability to connect with customers and invite them in for frequent visits with discounts and happy hour specials, which leads to further sales. Overall, Starbucks has captured enormous value through its investment in digital technologies.
  • A key growth driver here is the company’s exposure to China. At the end of the first quarter of fiscal 2021, it had 4,863 stores in China. While this hurt the company in early 2020, it should benefit the company in the long run as wealth in the country rises. Sales growth in China this year is expected to be between 27% and 32%.
  • The company recently advised that for the 2021 fiscal year, it expects global comparable store sales growth of 18% to 23%.
  • Next earnings release: Q2 results, 27 April 2021

Your capital is at risk. Other fees apply.

Charts sourced from eToro platform 02/03/2021. All trading carries risk. Only risk capital you can afford to lose.

This publication is considered a marketing communication and as such, it does not contain and should not be taken as containing, investment advice, personal recommendation, or an offer or solicitation to buy or sell any financial instruments. This publication has not been prepared in accordance with the legal and regulatory requirements to promote independent research. In producing this material, eToro has not taken any particular investment objectives or financial situation. Any references to past performance of a financial instrument, a financial index or a packaged investment product are not, and should not be taken as a reliable indicator of future results. eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared utilising publicly-available information. This communication must not be reproduced without consent from eToro.

eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Zero commission is only available to clients of eToro Europe Ltd. and eToro UK Ltd., and does not apply to short or leveraged stock trades. Zero commission means that no broker fee has been charged when opening or closing the position. Other fees apply. For additional information regarding fees visit Your capital is at risk.