Technology can dramatically change the way that individuals, organizations and corporations function. Just look around you and will see the enormous that technology has had on the world in the past twenty years. With this huge shift, it is imperative that as an investor you catch this technological wave if you haven’t already. Here are 5 tech stocks that should be in every portfolio.
Making Tech Profits
Stock analysts like to place certain companies on lists, but you must ask yourself – “How can I make money investing in said stock?” In the 1990s, there were a number of firms who were instrumental in helping the World Wide Web function properly. If you invested in these, before they became large, then you could make good money. Here are a couple of established tech stocks, along with some newbies.
1. Alibaba
In the 1800s, England ruled the world. In the 1900s, it was the United States. Could it be predicted that China will be the dominant country in this century?
China is the “factory of the world,” establishing high growth rates due to a cheap labor force, few regulations and hard work. Alibaba (BABA) is a great Chinese eCommerce technology play. The firm already has a market capitalization of $220 billion and has enjoyed a 55% spike in revenues during one quarter.
“Forrester Research” predicts compound annual growth rates of 19.9% until 2019 for Alibaba. Which Western firm can compete with such high growth rates?
2. Apple
The iPhone continues to lead the smartphone industry. With selfies, videos and Siri, the brand gives people a fun way to go about their everyday activities. The Apple (AAPL) brand used to be as consistent in making profits as McDonald’s.
After a slight misstep, the Apple stock was driven down by 17%. Therefore, you can now own Apple for a cheaper price. Buy low and stick with this well-known global brand.
3. Google
Not only do you search online using Google (GOOG), but you can also purchase the brand’s Lens and self-driving cars. And, now the #1 search engine is even entering the robotics industry, purchasing eight “robotics or artificial intelligence firms.”
Google Analytics help guide how many people will design their websites. With its inside knowledge about keyword searches, Google has a decided advantage. It remains a tech industry leader.
4. Samsung
Another great Asian tech stock is Samsung (SSNLF), which has some of the top smart phones, lithium-ion batteries, semiconductors, chips and flash memory devices. The firm is also expanding its reach, by investing in startups.
Samsung has invested $150 million into early stage startups, allowing it to review the latest technology. Down the road, they will have the inside path to consider possible mergers & acquisitions (M&A). They are also earning higher returns on their funds.
5. Yaskawa Electric
Already, robots have replaced humans in many automobile manufacturing factories. The Boston Consulting Group (BCG) estimates that “robots perform roughly 10% of all manufacturing tasks, but BCG sees that jumping to about 25% by 2025.” A robot does not need to take breaks to smoke from its e cigarette starter kit. That is a key advantage for some companies.
Jerry Kaplan wrote the book, Humans Need Not Apply, where he discussed the “Brave New World” of robotics. The “dark factory” is one where it is 100% robotic – no need for HVAC, lighting or other human creature comforts.
Robots don’t need to take breaks, eat food or be paid. Simple upkeep, maintenance and the initial cost is all that is needed with mechanical beings.
A pure tech play for robotics would be Yaskawa Electric (YASKY). Already, robot sales have increased to 225,000 units in 2014, according to the International Federation of Robotics. Yaskawa Electric has approximately 34% of the market with a market cap of $2.8 billion. Companies are sure to cut costs, by using more robots for productivity.
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