Liquid Oxygen Stocks To Buy During the Shortage

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Aug. 30 2021, Published 11:29 a.m. ET

The COVID-19 pandemic has spearheaded many shortages already, such as toilet paper, Lysol wipes, and poultry. Now, liquid oxygen is on that list. An oxygen shortage is roiling the southeast U.S., and state and local governments are looking for ways to curb demand.

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Meanwhile, investors are eyeing an investment opportunity that could help them capitalize on the oxygen shortage and the industry for enhanced production.

Fla. politician asks people to limit water use as liquid oxygen shortage continues

More than 56,000 Floridians were diagnosed with COVID-19 on Aug. 16. That's the highest number for the state ever, even surpassing any point in 2020. Hotspots are popping up across the U.S. (the number of COVID-19 hospitalizations across the country has exceeded 100,000 for the second time), though Fla. is definitely the reddest state in terms of infection rates.

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Because of this, Orlando mayor Buddy Dyer and the city's utilities commission chief customer and marketing officer, Linda Ferrone, joined forces on Aug. 20 to urge residents to limit water usage. Why? Because there's an oxygen shortage, and water treatment facilities use liquid oxygen to treat the water supply.

With such an intense surge in COVID-19 cases, that oxygen has become a precious commodity for hospitals that need to keep people breathing on ventilators. COVID-19 can cause low blood oxygen, which means some patients require highly concentrated oxygen to keep breathing.

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Why should investors target oxygen stocks?

Investing in oxygen stock at this crucial moment could bring two benefits. First, the high demand could boost your portfolio beyond the market average. Second, investments in the sector could bolster liquid oxygen production during the shortage. It's not an entirely altruistic bet, but one worth considering in tandem with defensive healthcare stocks.

Consider these oxygen stocks during the shortage

There are three main publicly traded medical oxygen product manufacturers in the U.S.

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Vapotherm, Inc. (NYSE:VAPO) is a N.H.-based corporation that manufactures medical devices, including oxygen. As of Aug. 30, shares were trading at $28.59. This is a 4.34 percent boost from the week prior, and a 13.36 percent jump over the last six months. Analysts agree that VAPO stock could see a sizable upswing over the next 12 months, with their median assumption sitting at 46.9 percent growth.

Inogen, Inc. (NASDAQ:INGN) is a Calif.-based conglomerate that owns numerous medical supply companies, including Comfort Life Medical Supply, LLC. On Aug. 30, the market value for INGN is $60.54. Shares were on a slight upswing on Aug. 30, at 1.55 percent in the green. Despite volatility over the last month bringing the stock down 26.3 percent, IMGN stock has grown 37.73 percent year-to-date. Its current price could be a perfect entry point.

Finally, Invacare Corporation (NYSE:IVC) manufactures and distributes non-acute medical equipment and respiratory products. The stock was up marginally on Aug. 30, at around $8.41. Year-to-date, volatility has brought IVC stock down by 5.19 percent, but demand means potential. Analysts expect IVC stock to grow tremendously over the next 12 months, with a median growth estimate of 77.3 percent.

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