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7 technology actions that could be the future FAANG
A few months ago, I started to suggest: “What are FAANG’s future actions?” We have seen Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN) and other technology stocks grow from modest winners to world giants. These shares went from $ 100 billion to $ 1 trillion in market capitalization. Many people talk about what it would be like if we had bought Apple in the 1980s or Amazon in 1999. While anyone who has bought and managed to endure so far is ridiculously wealthy, she has also faced a ton of volatility. InvestorPlace – Stock market news, stock advice and trading tips In addition, investors could have waited until the time of Apple’s iPhone or the clear dominance of e-commerce by Amazon and still get a return of 10 times or more about your investment. Do not believe me? Apple grew more than 1,000% in the last decade, while Amazon rose 1,760%. In the past five years alone – when it was absurdly clear that these two were established leaders – Apple and Amazon rose 463% and 442%, respectively. This led me to reflect: what are the next technology actions that can become new FAANG leaders? Specifically, I am looking for companies in the $ 50 billion to $ 300 billion market capitalization range, which can range from $ 400 billion to $ 1 trillion or more. It’s a admittedly wide range, but who cares – these winners are right under our noses. Let’s look at seven technology stocks: 7 safe stocks to buy with solid returns in tough times PayPal (NASDAQ: PYPL) Salesforce (NYSE: CRM) Nvidia (NASDAQ: NVDA) Advanced micro devices (NASDAQ: AMD) Roku (NASDAQ: ROKU) Shopify (NYSE: SHOP) Adobe Systems (NASDAQ: ADBE) Technology stocks to buy for future earnings: PayPal (PYPL) Source: JHVEPhoto / Shutterstock.com Current market value: $ 295 billion Many investors have continued to underestimate PayPal. of FAANG technology stocks in their youth years, this seems to be a basic observation of them as well. However, PayPal found a way to become a payment juggernaut. While sending money to friends and family is free and convenient, it is simply a part of the ecosystem. The company also makes some sales when it involves another business or merchant. It has become a safe, reliable and convenient way for companies to sell online or make subscriptions a piece of cake. PayPal’s acquisition of Venmo and Honey only added to these layers of engagement, while e-commerce will continue to be the main catalyst for its growth. For those looking for technology stocks, the power and trend of e-commerce need not be explained. Finally, PayPal is now in the cryptocurrency game, allowing customers to buy and sell Bitcoin, Bitcoin Cash, Etherium and Litecoin. PayPal may not be able to charge its current “fee” – read: commission – on these transactions forever, based on how stock commissions disappeared almost overnight in the brokerage industry. However, for now, it should act as a catalyst for further growth. Bonus: With a market capitalization of $ 100 billion, Square (NYSE: SQ) could also be considered as a member of FAANG’s new technology stocks in this regard. Salesforce (CRM) Source: Bjorn Bakstad / Shutterstock.com Current market value: $ 206 billion. It goes without saying that, given the massive gains that the stock market has registered in the past nine months, the ideal scenario would be a considerable correction for several stocks on this list. However, this does not apply to all of them. Take Salesforce, for example. This company continues to print money as revenue continues to rise. Despite all the doubts that Salesforce has endured over the years, it has done very well. Nor do management plans seem to stop. For example, management is looking to generate $ 60 billion in revenue by 2034. More recently, it intends to obtain Slack (NYSE: WORK), increasing its presence on workstations and intensifying its fight against Microsoft (NASDAQ: MSFT). 8 Cheap stocks to buy with your next stimulus check As we are talking about retracements, Salesforce is a great example. At the recent low, stocks were 25% below the highs. This looks like a great opportunity for a company that continually shows revenue growth of more than 20%. Nvidia (NVDA) Source: Sundry Photography / Shutterstock.com Current market value: $ 335 billion Admittedly slightly higher than what we were looking for, Nvidia needs to be included in this list. Almost all major technological trends are growing in demand. More Internet traffic is creating tension in the cloud, increasing the demand for cutting edge cloud computing. More data is creating more need for data centers. Increasing the capabilities of autonomous vehicles requires more computing power. Better computers require better graphics. The list is endless and Nvidia is always there. The company’s products serve several end markets with impressive secular growth. That is why, despite the pandemic, Nvidia saw such an extreme acceleration in earnings and revenue. His smart merger and acquisition strategy has allowed him to add high-quality names like Mellanox to reasonable ratings. Now Nvidia goes after Arm, a massive $ 40 billion deal. Nvidia is already approaching an unstoppable state, but with Arm it would be a steamroller. From a purely antitrust perspective, Nvidia should be fine. However, this “roller” position can cause some hiccups. Either way, this is a high quality name that will only increase in size over time. Advanced Micro Devices (AMD) Source: Sundry Photography / Shutterstock.com Current market value: $ 111.5 billion For Nvidia’s little brother, we have Advanced Micro Devices. At about a third the size, AMD quickly climbed the ladder while dramatically improving its finances. CEO Lisa Su orchestrated one of the most impressive payback stories in the stock market. Once left to die, AMD was trading firmly below the $ 2 mark in 2016. Now boasting a maximum of 52 weeks of $ 99 and change, the lead has been stellar. Like Nvidia, AMD is on a number of secular growth themes, as growing demand for technology results in growing demand for AMD. Also like Nvidia, AMD saw a huge increase in revenue and profits during the pandemic. In a final final comparison with Nvidia, AMD is also working to close a major acquisition. In October, the company agreed to acquire Xilinx for $ 35 billion. 9 Shares sold at a discount now Although this requires years of further growth, it is not difficult to imagine AMD growing to the size of Nvidia ($ 300 billion). Eventually, clearing this level can put you at the bottom end of the FAANG status in terms of size. Roku (ROKU) Source: jejim / Shutterstock.com Current market value: $ 53 billion Roku is difficult, because he is certainly the smallest name on the list (by far) and has just gone through a massive rally. The shares have risen 90% in the past three months, with Roku rising from a market capitalization of just $ 28 billion to where it is today. In addition, investors simply do not understand this company. They still think it will come face to face with Amazon and its cock breeders. While this is true, the story behind Roku is not the hardware – it is the platform. Roku doesn’t care if he’s making money from the hardware. Instead, its focus is on the platform, where it collects fees from content providers and ad revenue from its free Roku channel. In that respect, growth continues to explode. Analysts expect revenue growth of around 50% this year, followed by growth of 40% in 2021 and 36% in 2022. Respectfully, I believe you can be conservative. Bulls will recognize that a setback may be necessary (and potentially large). However, I don’t think Roku is at the top. For AMD, I mentioned the “lower limit of FAANG status,” which would be Netflix (NASDAQ: NFLX). It is currently a market cap of $ 250 billion and remember, the NFLX is at a new record. I could see a scenario in which Roku retreated 20% to 25% – giving him a market capitalization of around $ 40 billion – and finally reaching an entity of more than $ 200 billion. Shopify (SHOP) Source: justplay1412 / Shutterstock.com Current market value: $ 145 billion There is a problem with Shopify and several other names on this list: The rallies. While the massive bulls are great for long-term investors, they also make stocks susceptible to large setbacks. If and when we experience these declines, this is the opportunity for investors to attack. For Shopify, optimistic reasoning is multifaceted. First, Shopify is following a very large trend – e-commerce – and therefore will continue to benefit from robust growth. When the coronavirus hit, sales were not negatively impacted. Instead, merchants migrated to their platform, increasing Shopify’s revenue. Second, it is building the anti-Amazon business platform – giving both large and small merchants power and control over the customer experience. Now, the payoff here is huge, as Shopify develops various business segments, such as shipping, credit, Shopify Pay and others. However, the risk is also present. In other words, can those companies that want independence from Amazon offer quality customer experiences? Ultimately, companies and traders are at least willing to try. In December 2019, I said that investors could buy Shopify, despite their high rating. My argument centered on his assessment, saying that this name could go from a market capitalization of $ 40 billion to a market capitalization of $ 100 to $ 120 billion in a decade. 7 Safe actions to buy with solid returns in difficult times It was not obvious that more than tripling its value would occur in just a few months. In the long, long term, it is not difficult to imagine that name being significantly louder. Adobe Systems (ADBE) Source: r.classen / Shutterstock.com Current market value: $ 228 billion Last, but not least, is Adobe. This company does much more than just Flash or Photoshop. It has become a mainstay in e-commerce at the same time that it has become a beacon in the graphic, digital and creative scene. Find a freelance graphic designer who doesn’t use Adobe. The shares also quietly accumulated huge gains. Adobe has grown 140% over the past three years and 430% over the past five years. In the past decade, stocks have risen more than 1,300%, as their market value was around $ 16 billion just 10 years ago. It’s an impressive move and Adobe doesn’t show many signs of giving up. Analysts expect double-digit earnings and revenues this year and next, while the company’s gross margins remain solidly above 85%. While their profit margins have remained stable, their profit margins are skyrocketing. Adobe is quickly, but quietly, becoming a technology steamroller right in front of us. Like some others on this list, the stock has consolidated well over the past six months or so. Let’s see if that name can solve for the positive. At the time of publication, Bret Kenwell held a long position in AAPL, ROKU, CRM and NVDA. Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. More from InvestorPlace Why everyone is investing in 5G Everything wrong The stock picker reveals his next 1,000% winner No matter if you saved $ 500 or $ 5 million. 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