Hi everyone and welcome to another edition of my weekly stocks to watch! Our focus right now is going to be on tech stocks, which for the past few years and especially the last few months have totally outpaced the market.
This is personally my favorite stock of the tech giants. Since its founding in 1975, Microsoft has constantly innovated and remained at the forefront of modern technology. The business is divided into three main sectors, all of which currently provide about the same amount of revenue.
The first and most well-known of these is the More Personal Computing department, which provides products and services–such as the operating system, Surface, and gaming systems–to individual consumers. This has been the most consistent performer throughout its history and offers a steady source of revenue as Microsoft continues to innovate in this space alongside Apple and other competitors.
The second business segment is that of the Productivity and Business Processes. These are products and services tailored to businesses to improve their functioning and corporate efficiency (think Microsoft Office). As businesses become more remote and otherwise dependent on technology, this segment has the potential to meet new needs and to continue to grow.
The final, and arguably most exciting, sector of Microsoft is its Intelligent Cloud branch. This segment provides computer servers (via its data centers) and other cloud services that companies can use to operate their businesses. This sector has by far been the fastest grower and has plenty more room to do so.
Microsoft has also been investing in some very lucrative areas, including 5g technology, joining the push to develop 5G towers that rely more on software than on specialized hardware. Also, contained within Microsoft’s three business segments are smaller (yet exciting) companies that it owns, including Linkedin and Github. All of these factors make MSFT a great bet for the long term.
A stock that I do not own and don’t know why. This is a great option that must have slipped my mind somehow. The 16th largest US tech company by market capitalization and one of the main computer chipmakers, Nvidia is highly innovative and provides top-of-the-line products in an industry with massive growth potential. Nvidia creates highly specialized chips, called graphics processing units–or GPUs–generally used for video gaming. However, these chips and others they make have proven useful in recent years for cryptocurrency mining and running artificial intelligence programs. As a chipmaker, Nvidia’s products have potentially limitless applications in the world today, from data centers to automated cars to 5G towers. As the internet of things (IoT, or the world of interconnected technology devices) develops, computers–and thus computer chips–will be at the center of the revolution. Nvidia is one of the best chip-making companies that you could buy.
And last but not least, Qualcomm is a company directly at the forefront of 5G technology. Another semiconductor chip company, this one with a focus on wireless devices and connectivity, Qualcomm offers the combination of size and innovation. 5G is poised to change the world in a way that arguably no other generation of internet connectivity has, by providing the infrastructure necessary to create the internet of things. Technological devices will eventually surround us, whether they be smart factories or self-driving cars. The catalyst for this change is 5G, so its market offers understandably immense opportunity.
Qualcomm, which produces semiconductors used in mobile devices and wireless infrastructure, is in a great position to capitalize on this emerging market and to serve as one of its main players as it grows to immense proportions. Also, the company has been investing in millimeter wave technology, antenna technology, and other areas of 5G development. In a market with such high growth potential, Qualcomm — with all its current market share and resources — would have to do everything wrong not to profit.
While our writers talk about these stocks, we are in no way giving the reader investment advice or urging them to buy any stocks. The goal of this series is merely to provide an opinion on certain stocks; what our readers choose to do with this opinion is entirely up to them. This is not meant in any way to be investment advice.