Why should you be interested in tech stocks? Tech stocks have been the most financially rewarding and exciting sector in the stock market and no competition. But don’t be one of the people online investing for dummies.
Many companies are misleading people telling they are tech companies even if they are not. Tech stocks have been the best performing sector in the stock market for the last 10 to 15 years. These are the top 5 tech companies that you should be investing today.
#1. Apple
Apple develops and designs products such as the iPhone, MacBook, iPads, and so on. Most people would agree that Apple is one of the best tech stocks out there, so it would be crazy to have a list and not include it. iPhone sales are trending back in the right direction after a few slow quarters of sales.
But the company is also seeing a lot of growth outside of iPhone purchases. Most of the company’s growth is currently generated by two fast-growing segments, services, and wearables. Revenue and their services jumped 18% generating over 46 billion in total service revenue.
This was a new service record, and also revenue in wearables jumped 54 percent year-over-year in Apple’s fourth-quarter earnings report. They beat all of the analysts’ expectations.
The company also provided better than expected guidance for the upcoming holiday season, which is a very crucial season for a company like Apple. It’s a good idea that the company is moving away from iPhone sales to services and wearables. Because they are heavily dependent on their iPhone sales, and that will hurt them.
#2. Amazon
Amazon is one of the best eCommerce platforms or an online retailer, digital streaming service, and a cloud provider. It is currently the world’s largest e-commerce company, but they are more than just an online retailer. The company was estimated to have about 38% to 49% of all online retail sales in the U.S. in 2019.
The next closest competition is eBay, and they have 6% of the share of online retail. E-commerce is still the primary revenue driver for the company. Some people believe they are getting saturated, but they’re wrong. Total eCommerce, not just Amazon, eBay, and all online sales only make up about 11% of all U.S. retail sales.
That means most retail sales are made offline. By 2021, eCommerce is expected to have only about 14% of all U.S. retail sales. In the long run, it can get to 30% to 40%: not just Amazon but all online transactions.
#3. Facebook
Facebook is a social media and is one of the most popular social network platforms today. The company also owns Instagram, which they bought for 12 million dollars in 2012 and even WhatsApp. In Facebook’s recent earnings, they showed analysts that they’re still growing very well for a 500-billion dollar company.
The company reported a 28% year-over-year rise in revenue and a 90% year-over-year increase in net income. Similar to Amazon, analysts began to believe that Facebook was a little bit saturated. But they are mistaken.
You can see by looking at Facebook’s two most important metrics they used to measure growth and that their Daily Average Users and Monthly Average Users. It shows consistent growth in both DAU and MAU in the last 12 quarters. In quarter 3, Facebook hit a new record.
#4. Microsoft
Microsoft is a computer software company. The company’s share price recently closed at a new all-time on making Microsoft one of the most valuable tech companies in the world. The company’s latest earnings showed the company generated a record end year revenue of about 130 billion dollars, which is a year-over-year increase of about 40%.
#5. Alibaba
Alibaba is China’s largest online retailer, and it’s number two to Amazon in the world. The company broke a new singles day record. With singles’ day is Alibaba’s version of prime day. And only did they break the record, but their most recent singles day was the largest online shopping day in the world, beating Amazon’s prime day.
And even during this trade war, the company is still seen as one of the decent growth companies. The most recent earnings they reported revenue rose about 40% annually in its eCommerce segment.
Takeaway
Now is the right time to invest in tech stocks because it’s going to grow a lot bigger. The bigger they get, the more powerful and profitable they become. You must understand which companies are misleading you. There are a lot of companies that would call themselves tech companies that are or aren’t.
At the end of the day, what matters most is if this company is innovating. And if they are, they’re probably using technology in a way that helps better serve their customers and grow.