Connect with us

These 3 Growth Tech Stocks Still Have Tons of Promise

there are still plenty of growth tech stocks that have tons of promise. Let’s take a look at three of them.
The post These 3 Growth Tech Stocks Still…

Published

on

So far, 2022 has been a tough year for the stock market. Thanks to rising interest rates, many high-flying growth tech stocks have gotten slammed. In fact, it has been so bad that even traditional “safe haven” stocks like Netflix, Amazon, and Facebook are down 30% or more. But, for investors with a longer time horizon, this correction could create an amazing buying opportunity. Despite their stock prices, there are still plenty of growth tech stocks that have tons of promise. Let’s take a look at three of them.

The Best Growth Tech Stocks To Buy

No. 3 Coinbase (Nasdaq: COIN)

Sometimes, the stock market just doesn’t seem to make any sense. Here’s one example. Coinbase reported a 2021 annual revenue of $7.84 billion, up 514% year-over-year (YOY). It also reported a net income of $3.62 billion, up 1,024% YOY. At first glance, results like this should have investors doing backflips. But, the opposite is happening and the stock is down over 60% since its IPO.

It’s not even like Coinbase was wildly overvalued and is going through a much-needed correction. Coinbase currently has a market cap of around $27 billion and a P/E ratio of just over eight. This is incredibly low, especially for one of the most exciting high-growth tech stocks out there.

Many investors seem to think that 2021 was an outlier year for Coinbase’s earnings. However, there has been so much promising news in the crypto industry lately. There’s no reason to believe that crypto trading will slow anytime soon. Here are a few examples of positive news:

  1. The Central African Republic followed El Salvador in declaring Bitcoin legal tender.
  2. Multiple U.S. politicians have bought cryptocurrency.
  3. Goldman Sachs issued a Bitcoin-backed loan.
  4. Blackrock is considering offering crypto services.
  5. Crypto played a critical role in raising aid for Ukraine.

These aren’t exactly signs of an industry in decline.

Coinbase also recently launched an NFT marketplace. It’s not an exaggeration to say that this marketplace could end up making Coinbase more money than crypto trading does.

As it stands now, Coinbase has plenty of positive headwinds working for its business. This makes it one of the most fairly-valued growth tech stocks out there.

No. 2 Roku (Nasdaq: ROKU)

Roku was one of the pandemic’s biggest winners, with the stock rising around 240% during 2020. However, it’s likely that the stock got overvalued and it’s now down 25% since 2020. Despite the recent stock slump, Roku’s potential as one of the best growth tech stocks remains solid.

In Q1 2022, Roku reported strong numbers:

  • Total net revenue grew 28% YOY to $734 million.
  • Gross profit was up 12% YOY to $365 million.
  • Roku added 1.1 million incremental Active Accounts in Q1 2022 to reach 61.3 million.
  • Average Revenue Per User (ARPU) grew to $42.91 (trailing 12-month basis), up 34% YOY.
  • The Roku Channel was a top five channel on the Roku platform in the U.S. by reach and engagement.

One reason that Roku stock is down could be due to what’s going on at other streaming companies. Netflix recently reported declining users for the first time ever. CNN+ also shut down just one month after getting little traction. Due to this, many investors are questioning the future of streaming. However, it’s likely that these issues are unique to those specific platforms, not streaming as a whole.

Roku’s recent strong numbers show that streaming is not necessarily declining. If anything, people just seem to be shifting where they stream content from. Early data shows that consumers are flocking toward ad-supported free streaming services like Tubi. It could just be that people are sick of paying for multiple subscriptions. Either way, none of this matters for Roku.

At the end of the day, it doesn’t matter which platform people stream from. Roku offers pretty much every major streaming platform. This is why Roku remains one of the top growth tech stocks despite a recent slump.

Growth Tech Stocks No. 1 Etsy (Nasdaq: ETSY)

Etsy is another pandemic stock that likely got overvalued. Since the start of 2020, Etsy soared over 550% to an all-time high of $294/share. Now, it’s in major correction territory and is down over 50% so far in 2022. However, Etsy is much different than most pandemic stocks. This mainly comes down to demand.

For example, consider a company like Zoom, which soared during the pandemic. Now that the pandemic is over, many employees are back in the office. This means that there is a much smaller need to use Zoom in the post-pandemic world. The same is true for the stationary bike company Peloton. Peloton’s got incredibly popular during the pandemic because there was virtually no gym access. Now that gyms are open, there’s no need to spend thousands on a stationary bike. Etsy, a digital marketplace for handmade goods, is in a different situation that these companies.

Even though the pandemic is over, people will still need to buy things online. When they do, they’re still likely to visit Etsy’s platform. Ecommerce isn’t something that stops in the post-pandemic world. However, Etsy’s stock is getting punished like it is.

In fact, Etsy has already seen early evidence of returning buyers. It reported that ​​53% of all active buyers and 37% of new buyers who made a purchase in 2020 returned to make a purchase in 2021. Moving forward, Etsy is investing over $100 million into its platform to improve the customer’s shopping experience. Etsy is a great stock to add to your list of best growth tech stocks. It’s also done a good job of building its brand.

Creating a Differentiated Experience

Based on numbers alone, it’s hard to tell what makes Etsy different from Amazon or Ebay. It’s just another digital marketplace to buy things, right? Not exactly.

Etsy has done a great job of positioning itself as a champion of small businesses. Its mission statement is to “keep commerce human”. In a world that’s increasingly dominated by large conglomerates, Etsy’s effort to promote entrepreneurs strikes a chord with many shoppers.

When you buy something on Etsy, you get the feeling that you are supporting a small business. This is because Etsy spends a lot of time investing in its community of sellers. Compare this to a company like Amazon, which replaces humans with robots wherever possible. Amazon sellers have also accused Amazon of creating Amazon-branded replicas of popular products to undercut sellers.

Another key part of Etsy’s strategy is offering unique, handmade goods. This helps differentiate it from other digital marketplaces. In fact, 87% of Etsy shoppers say that Etsy has products that they can’t find elsewhere. So far, all of this is showing up in Etsy’s bottom line.

Etsy reported a 2021 annual income of $2.33 billion, up 35% YOY. It also reported a net income of $493.5 million, up 41%. Keep in mind that these numbers are compared to 2020, which was a record year for Etsy.

I hope that you’ve found this article on growth tech stocks to be valuable! Please remember that I’m not a financial advisor and am just offering my own research and commentary. As usual, please base all investment decisions on your own due diligence.

The post These 3 Growth Tech Stocks Still Have Tons of Promise appeared first on Investment U.

Read More

Continue Reading

Uncategorized

NY Fed Finds Medium, Long-Term Inflation Expectations Jump Amid Surge In Stock Market Optimism

NY Fed Finds Medium, Long-Term Inflation Expectations Jump Amid Surge In Stock Market Optimism

One month after the inflation outlook tracked…

Published

on

NY Fed Finds Medium, Long-Term Inflation Expectations Jump Amid Surge In Stock Market Optimism

One month after the inflation outlook tracked by the NY Fed Consumer Survey extended their late 2023 slide, with 3Y inflation expectations in January sliding to a record low 2.4% (from 2.6% in December), even as 1 and 5Y inflation forecasts remained flat, moments ago the NY Fed reported that in February there was a sharp rebound in longer-term inflation expectations, rising to 2.7% from 2.4% at the three-year ahead horizon, and jumping to 2.9% from 2.5% at the five-year ahead horizon, while the 1Y inflation outlook was flat for the 3rd month in a row, stuck at 3.0%. 

The increases in both the three-year ahead and five-year ahead measures were most pronounced for respondents with at most high school degrees (in other words, the "really smart folks" are expecting deflation soon). The survey’s measure of disagreement across respondents (the difference between the 75th and 25th percentile of inflation expectations) decreased at all horizons, while the median inflation uncertainty—or the uncertainty expressed regarding future inflation outcomes—declined at the one- and three-year ahead horizons and remained unchanged at the five-year ahead horizon.

Going down the survey, we find that the median year-ahead expected price changes increased by 0.1 percentage point to 4.3% for gas; decreased by 1.8 percentage points to 6.8% for the cost of medical care (its lowest reading since September 2020); decreased by 0.1 percentage point to 5.8% for the cost of a college education; and surprisingly decreased by 0.3 percentage point for rent to 6.1% (its lowest reading since December 2020), and remained flat for food at 4.9%.

We find the rent expectations surprising because it is happening just asking rents are rising across the country.

At the same time as consumers erroneously saw sharply lower rents, median home price growth expectations remained unchanged for the fifth consecutive month at 3.0%.

Turning to the labor market, the survey found that the average perceived likelihood of voluntary and involuntary job separations increased, while the perceived likelihood of finding a job (in the event of a job loss) declined. "The mean probability of leaving one’s job voluntarily in the next 12 months also increased, by 1.8 percentage points to 19.5%."

Mean unemployment expectations - or the mean probability that the U.S. unemployment rate will be higher one year from now - decreased by 1.1 percentage points to 36.1%, the lowest reading since February 2022. Additionally, the median one-year-ahead expected earnings growth was unchanged at 2.8%, remaining slightly below its 12-month trailing average of 2.9%.

Turning to household finance, we find the following:

  • The median expected growth in household income remained unchanged at 3.1%. The series has been moving within a narrow range of 2.9% to 3.3% since January 2023, and remains above the February 2020 pre-pandemic level of 2.7%.
  • Median household spending growth expectations increased by 0.2 percentage point to 5.2%. The increase was driven by respondents with a high school degree or less.
  • Median year-ahead expected growth in government debt increased to 9.3% from 8.9%.
  • The mean perceived probability that the average interest rate on saving accounts will be higher in 12 months increased by 0.6 percentage point to 26.1%, remaining below its 12-month trailing average of 30%.
  • Perceptions about households’ current financial situations deteriorated somewhat with fewer respondents reporting being better off than a year ago. Year-ahead expectations also deteriorated marginally with a smaller share of respondents expecting to be better off and a slightly larger share of respondents expecting to be worse off a year from now.
  • The mean perceived probability that U.S. stock prices will be higher 12 months from now increased by 1.4 percentage point to 38.9%.
  • At the same time, perceptions and expectations about credit access turned less optimistic: "Perceptions of credit access compared to a year ago deteriorated with a larger share of respondents reporting tighter conditions and a smaller share reporting looser conditions compared to a year ago."

Also, a smaller percentage of consumers, 11.45% vs 12.14% in prior month, expect to not be able to make minimum debt payment over the next three months

Last, and perhaps most humorous, is the now traditional cognitive dissonance one observes with these polls, because at a time when long-term inflation expectations jumped, which clearly suggests that financial conditions will need to be tightened, the number of respondents expecting higher stock prices one year from today jumped to the highest since November 2021... which incidentally is just when the market topped out during the last cycle before suffering a painful bear market.

Tyler Durden Mon, 03/11/2024 - 12:40

Read More

Continue Reading

International

This is the biggest money mistake you’re making during travel

A retail expert talks of some common money mistakes travelers make on their trips.

Published

on

Travel is expensive. Despite the explosion of travel demand in the two years since the world opened up from the pandemic, survey after survey shows that financial reasons are the biggest factor keeping some from taking their desired trips.

Airfare, accommodation as well as food and entertainment during the trip have all outpaced inflation over the last four years.

Related: This is why we're still spending an insane amount of money on travel

But while there are multiple tricks and “travel hacks” for finding cheaper plane tickets and accommodation, the biggest financial mistake that leads to blown travel budgets is much smaller and more insidious.

A traveler watches a plane takeoff at an airport gate.

Jeshoots on Unsplash

This is what you should (and shouldn’t) spend your money on while abroad

“When it comes to traveling, it's hard to resist buying items so you can have a piece of that memory at home,” Kristen Gall, a retail expert who heads the financial planning section at points-back platform Rakuten, told Travel + Leisure in an interview. “However, it's important to remember that you don't need every souvenir that catches your eye.”

More Travel:

According to Gall, souvenirs not only have a tendency to add up in price but also weight which can in turn require one to pay for extra weight or even another suitcase at the airport — over the last two months, airlines like Delta  (DAL) , American Airlines  (AAL)  and JetBlue Airways  (JBLU)  have all followed each other in increasing baggage prices to in some cases as much as $60 for a first bag and $100 for a second one.

While such extras may not seem like a lot compared to the thousands one might have spent on the hotel and ticket, they all have what is sometimes known as a “coffee” or “takeout effect” in which small expenses can lead one to overspend by a large amount.

‘Save up for one special thing rather than a bunch of trinkets…’

“When traveling abroad, I recommend only purchasing items that you can't get back at home, or that are small enough to not impact your luggage weight,” Gall said. “If you’re set on bringing home a souvenir, save up for one special thing, rather than wasting your money on a bunch of trinkets you may not think twice about once you return home.”

Along with the immediate costs, there is also the risk of purchasing things that go to waste when returning home from an international vacation. Alcohol is subject to airlines’ liquid rules while certain types of foods, particularly meat and other animal products, can be confiscated by customs. 

While one incident of losing an expensive bottle of liquor or cheese brought back from a country like France will often make travelers forever careful, those who travel internationally less frequently will often be unaware of specific rules and be forced to part with something they spent money on at the airport.

“It's important to keep in mind that you're going to have to travel back with everything you purchased,” Gall continued. “[…] Be careful when buying food or wine, as it may not make it through customs. Foods like chocolate are typically fine, but items like meat and produce are likely prohibited to come back into the country.

Related: Veteran fund manager picks favorite stocks for 2024

Read More

Continue Reading

Spread & Containment

A major cruise line is testing a monthly subscription service

The Cruise Scarlet Summer Season Pass was designed with remote workers in mind.

Published

on

While going on a cruise once meant disconnecting from the world when between ports because any WiFi available aboard was glitchy and expensive, advances in technology over the last decade have enabled millions to not only stay in touch with home but even work remotely.

With such remote workers and digital nomads in mind, Virgin Voyages has designed a monthly pass that gives those who want to work from the seas a WFH setup on its Scarlet Lady ship — while the latter acronym usually means "work from home," the cruise line is advertising as "work from the helm.”

Related: Royal Caribbean shares a warning with passengers

"Inspired by Richard Branson's belief and track record that brilliant work is best paired with a hearty dose of fun, we're welcoming Sailors on board Scarlet Lady for a full month to help them achieve that perfect work-life balance," Virgin Voyages said in announcing its new promotion. "Take a vacation away from your monotonous work-from-home set up (sorry, but…not sorry) and start taking calls from your private balcony overlooking the Mediterranean sea."

A man looks through his phone while sitting in a hot tub on a cruise ship.

Shutterstock

This is how much it'll cost you to work from a cruise ship for a month

While the single most important feature for successful work at sea — WiFi — is already available for free on Virgin cruises, the new Scarlet Summer Season Pass includes a faster connection, a $10 daily coffee credit, access to a private rooftop, and other member-only areas as well as wash and fold laundry service that Virgin advertises as a perk that will allow one to concentrate on work

More Travel:

The pass starts at $9,990 for a two-guest cabin and is available for four monthlong cruises departing in June, July, August, and September — each departs from ports such as Barcelona, Marseille, and Palma de Mallorca and spends four weeks touring around the Mediterranean.

Longer cruises are becoming more common, here's why

The new pass is essentially a version of an upgraded cruise package with additional perks but is specifically tailored to those who plan on working from the ship as an opportunity to market to them.

"Stay connected to your work with the fastest at-sea internet in the biz when you want and log-off to let the exquisite landscape of the Mediterranean inspire you when you need," reads the promotional material for the pass.

Amid the rise of remote work post-pandemic, cruise lines have been seeing growing interest in longer journeys in which many of the passengers not just vacation in the traditional sense but work from a mobile office.

In 2023, Turkish cruise line operator Miray even started selling cabins on a three-year tour around the world but the endeavor hit the rocks after one of the engineers declared the MV Gemini ship the company planned to use for the journey "unseaworthy" and the cruise ship line dealt with a PR scandal that ultimately sank the project before it could take off.

While three years at sea would have set a record as the longest cruise journey on the market, companies such as Royal Caribbean  (RCL) (both with its namesake brand and its Celebrity Cruises line) have been offering increasingly long cruises that serve as many people’s temporary homes and cross through multiple continents.

Read More

Continue Reading

Trending