During the last decade, investors had put their money to work in shares of Phand Phang – Facebook, Adventuress (NASDAQ: AMZN), Apple, Netflix, And Alphabet – Defeated the broader market by a wide margin. In the past 10 years, these tech bigwis have gained between 398% and 4,800% in the share price, compared to just 160%. S&P 500. Those benefits will be harder to replicate in the coming decade.
Additionally, drunk with antitrust sentiment is getting louder in Washington, DC these days. A scathing report released last week by the Antitrust Panel of the House Judiciary Committee accused the big technology of misusing its power and competing, and called for the breakdown of possibly some of the technology’s biggest players. At least four of FAANG’s five stocks have recently become targets of antitrust investigations.
Some investors are looking for alternative options to buy and hold for the coming decade, without an audience of mistrust hanging over their shoulders. Here are four alternative stock investors to consider.
1. Pinterest: Anti Facebook
There is no denying that Facebook is the largest social media provider on the planet with 2.7 billion monthly active users. But the company has caught the eye of regulators and legislators, and an antitrust lawsuit could be filed by the end of the year. Investors looking for compelling options should look no further than this Pinterest (NYSE: PIN).
The website and smartphone app present themselves as anti-social media, which serve to give a positive experience missing on other platforms. By allowing users to “pin” a private board, Pinterest works to inspire them to get away from the keyboard and survive, such as traveling, starting a project or cooking a new recipe, Just to name a few.
In the second quarter, Pinterest announced that it proved to be a major milestone, with more than 400 million going to the platform each month. Its monthly active users (MAU) grew by 76%, 39% year-over-year, reaching a total of 416 million, faster than the 26% increase in Q1.
Pinterest continued the slow pace of monetization of its platform, as revenue grew 4% year-over-year and its net loss increased 91%. It is foreign markets that are developing a lot, as international revenue climbed 72%. Average revenue per user (ARPU) is significantly lower in foreign markets than in the US, coming in at $ 0.14 and $ 2.50, respectively, reflecting the large opportunity ahead.
2. Roku: Netflix and more
Although Netflix has so far avoided the eyes of regulators, the simple truth is that the stock is unlikely to have a 4,800% return in the coming decade, as it did in the last 10 years. This leaves investors looking for a fast-growing alternative. She is there Roku (NASDAQ: Roku) Come.
The company is widely known for its name streaming devices, but it is the combination of data, digital advertising, and its ecosystem that will inspire Roku in the future. In addition to its pocket-size streaming devices, Roku has the No. 1 selling smart TV operating system in North America, found in 1-in-3 smart TVs in the US and 1-in-4 in Canada. This gives the company a unique reach with streaming audiences for its targeted advertising.
Roku has always been platform agnostic, opening its system to all commers, with literally thousands of apps available within its system. This includes not only paid services such as Netflix and Amazon Prime Video, but also Thousands Of ad-supported services. Roku uses its vast data to advertise and target the right consumer.
Even when the marketing budget was in decline during the epidemic, Roku’s revenue increased 42% per year in the second quarter, as advertisers demanded more bang for their buck. At the same time, active accounts climbed 41%, and streaming video hours jumped 65% as existing viewers became more engaged.
By avoiding the need to continuously generate new content, Roku has carved out a large and lucrative niche for itself in the streaming-video market.
3. Shopify: Amazon is not the only e-commerce game in the city
Amazon was once a fearsome swamp, but has become the leading e-commerce marketplace not only in the US and worldwide. But it is the sheer dominance of the platform that has attracted the interest of antitrust watchdogs who accuse the company of misusing its leading position.
For investors, however, Amazon is not the only e-commerce game in the city – in fact, it is not even the fastest growing. Among the biggest names in digital retail, he is respected Shopify (NYSE: SHOP).
With the onset of the epidemic, merchants still had not embraced e-commerce, which turned to showdown in drums, pushing up year-over-year growth of 97% in the second quarter, while its adjusted earnings per share (EPS) ) Increased tenfold. Other metrics show the magnitude of the ongoing gold rush for online retail. Gross merchandise volume (GMV) – the value of products sold in its ecosystem – rose 119%, while merchant-solution revenue increased by 148%.
Shopify has already boasted more than 1 million merchants worldwide, but the number has certainly risen as a result of the sea change of e-commerce that has spread this year. Shopify said new stores on its platform grew 71% since the end of the first quarter alone.
Once merchants have created an additional revenue stream from online sales, simply do not go back. This is progressing well for Shopify.
4. Microsoft: A Compelling Cloud Option
Cloud computing is on the move and has received a major boost from this epidemic, with both Amazon Web Services (AWS) and Google Cloud benefiting from the trend. However, both companies have a boundary line of antitrust regulators, where to turn on a cloud investor? Enter Microsoft (NASDAQ: MSFT).
There is no denying that AWS dominates the cloud landscape, but Microsoft Azure is closing the gap by developing rapidly over the past few years. For the three months ended June 30, 2020, Azure grew 47% year-over-year during the quarter, while AWS grew just 29%.
Microsoft’s commercial cloud surpassed $ 50 billion in trailing-12-month revenue for the first time. For reference, AWS reported $ 40 billion in net sales.
It is important to note that neither company provides detailed information on what is involved in their respective segments, so it is not a comparison of an apple to an apple. However, it shows that Microsoft continues to close the gap with its larger rival.
This is not the only reason for Microsoft to come fast. For its fiscal fourth quarter (ending June 30), revenue grew 13% year-over-year, while net income grew 15% as the company grew its business software, artificial intelligence, and technology into the cloud ecosystem. Takes advantage of a strong position.
It is also worth noting that while many shares of FAANG have caught the eye of regulators, Microsoft has attracted public attention inside the Beltway (at least this decade).