We’re coming up on the one-year anniversary of what at the time seemed like a controversial call.
But it turned out to be very profitable.
See, back on July 26, 2019, I suggested you invest in a breakout stock that had just gotten slaughtered.
My column appeared the very day after the company I have in mind lost more than 25% of its value – in a single session.
Despite that drubbing, I struck a very confident tone. How could I be so sure of a strong return?
Fair question. Simple answer. The company has a long track record of excellent earnings growth.
And those kinds of stocks very often not only weather setbacks but go on to become market leaders once again. This medical device leader rallied back by 40% in just five months.
Don’t worry if you never heard of Nick Molnar because most investors haven’t.
And yet, the story of the young entrepreneur is impressive. At the ripe old age of 30, he’s become a billionaire.
Not bad for a guy who started his fintech firm just six years ago. Afterpay Ltd. provides installment-payment plans pitched as better alternatives to credit cards.
Here’s the thing. Molnar recently received a flattering profile in the prestigious Wall Street Journal. The paper seemed particularly impressed that Afterpay has added 1.6 million U.S. users.
I believe there are two problems with this story. First, the company is based in Australia and U.S. shares only trade over the counter, which sharply reduces institutional support.
Second, there’s a U.S. based fintech leader with more than 100 times as many users and that I believe is a much better investment.
Cellphones, garage door openers, police scanners, broadcast TV, and Navy radar systems all have one thing in common. They use one of the scarcest resources on the planet…Spectrum.
On top of that, everyone is using it more then ever as we stream movies from our phones or video chat with a friend or relative across the country.
We’ve just celebrated the one-year anniversary of one of the largest mergers ever to hit the defense industry.
As someone who has been around military technology since high school, I was and remain a big fan of this move.
And it’s not just because the combined firm had first-quarter sales that were up by a stunning 168%, though I believe it does prove the value of this move.
The merger created a firm with more than $16 billion in yearly sales and a $35 billion market cap.
Along the way, the linkup cemented the firm status’s an electronics-centric leader with a strong moat and that’s in a field vital to America’s security.
Mordor Intelligence projects the sector where this firm excels is going to grow 14% between now and 2024. And that’s on top of a current base worth $124 billion.
Over the past five years, the stock has nearly doubled the overall market’s return.
U.S.-Chinese tensions have run high ever since Trump laid out plans to counter unfair trade practices from China in 2016.
These tensions have rippled across almost every industry, but almost none as prevalent as in the telecom industry. This is a war against Chinese company Huawei, the world’s largest provider of telecommunications equipment and a leader in next-generation 5G technology.
Now, this is not exactly a new conflict with Huawei, but this could be the biggest one yet as one of the largest telecom equipment upgrades in history is taking place right now with 5G. Taking a step back, issues with Huawei go all the way back to 2003, when Cisco Systems Inc. (NASDAQ: CSCO) sued the company over theft of its technology. This was over several patents, which Cisco eventually won.
Here are just a few of the conflicts over the years:
2004: Huawei employee caught spying at a trade show.
2008: Leaked documents show Huawei secretly helped North Korea build its wireless network.
2009: Accused of corporate espionage after Huawei employee tries to extract data from an Indonesian mobile operator.
2012-2017: Huawei-installed technology at African Union headquarters was reportedly hacked for five years.
I think you get the picture. It’s no wonder the United States, and now the rest of the world, is looking to cut Huawei out of its telecom networks.
The United States officially banned Huawei when Trump signed an executive order in May 2019, and now this week, the United Kingdom has followed suit and banned Huawei from its 5G networks. On top of that, London is calling for the removal of all Huawei equipment by 2027. The United States and UK are not the only two countries that have banned Huawei either. Dozens of others have also done so, including Telecom Italia excluding Huawei from bidding on its 5G network project in Brazil.
But this isn’t just geopolitical hardball. It’s an opportunity for investors.
5G is one of the biggest tech investing opportunities you’ll ever see, and one of the leading companies is being barred from the biggest markets in the world.
Pandemic or not, I’m doing my part to keep the chip industry healthy.
See, I just bought three dozen semiconductors.
And I don’t meant shares in chip companies.
To be more energy-efficient, I bought a bunch of semiconductors disguised as lightbulbs.
Let me explain: I bought LEDs, or Light Emitting Diodes. These are tiny semiconductors that emit light when electrical current flows through them.
They’re used in TV remotes, monitors, smartphones, and of course, lightbulbs. They use a fraction of the juice that conventional lightbulbs do.
Grand View Research say the global LED lighting market alone is set to grow by 13.4% annually from $54 billion last year until it reaches $127 billion in 2027.
As impressive as that sounds, that’s still just a small part of the $430 billion chip sector.
Every time I walk out of my apartment and walk past the mountain of packages left for residents in my building, I’m reminded of Amazon.com Inc. (NASDAQ: AMZN).
By now, everyone in the United States has heard of it. You see its packages and boxes in the recycling and delivery trucks with the large, unmistakable Amazon logo. It even has its own fleet of planes that you might see at the airport. Not just an e-commerce company, it also has a music service, the top video game streaming service, payments platform, an over-the-top entertainment platform, and one of the largest web services in the United States. This is how you create a trillion-dollar company.
According to Consumer Intelligence Research Partners, it has 112 million members in its Prime loyalty program as of December 2019. That is 34% of the U.S. population, and given that people sign up as families, eMarketer takes it one step further and suggests that 82% of households have a Prime account.
These tensions have rippled across almost every industry, but almost none as prevalent as in the telecom industry. This is a war against Chinese company Huawei, the world’s largest provider of telecommunications equipment and a leader in next-generation 5G technology.
By now, everyone in the United States has heard of it. You see its packages and boxes in the recycling and delivery trucks with the large, unmistakable Amazon logo. It even has its own fleet of planes that you might see at the airport. Not just an e-commerce company, it also has a music service, the top video game streaming service, payments platform, an over-the-top entertainment platform, and one of the largest web services in the United States. This is how you create a trillion-dollar company.