227.60 +0.72 (0.32%)
After hours: 7:33PM EDT
|Bid||226.90 x 800|
|Ask||227.90 x 800|
|Day's Range||225.11 - 236.92|
|52 Week Range||83.66 - 257.99|
|Beta (3Y Monthly)||2.84|
|PE Ratio (TTM)||118.60|
|Earnings Date||Aug 8, 2019|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||205.88|
Columbia Sportswear, SINA, Trade Desk, Roku and Square highlighted as Zacks Bull and Bear of the Day
There are many things to be ironed out still with respect to banks and regulators before the currency officially launches in the first half of 2020.
The Trade Desk (TTD) closed the most recent trading day at $244.94, moving -0.79% from the previous trading session.
We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always […]
We're finally seeing U.S. stocks cool off a bit after a miraculous run over the past few week or so. One would think that the bears could undo some of these gains here. The fact that they can't says it's more likely buyers are taking a rest right now rather than sellers taking control. That can always change -- sometimes just from a tweet -- but for now, we have to respect that observation. Let's look at some top stock trades going forward. Top Stock Trades for Tomorrow 1: Facebook Click to EnlargeFacebook (NASDAQ:FB) shares are under pressure with worries about whether CEO Mark Zuckerberg was aware of the company's privacy issues. InvestorPlace - Stock Market News, Stock Advice & Trading TipsThe stock was rejected from its 50-day moving average and is failing to hold its 20-day moving average. It's no surprise that downtrend resistance (blue line) is also squeezing it lower. * 5 Tech Stocks That Are Far Too Risky Right Now Let's see where it firms up. If buyers come in to defend FB, $175 may hold. If not, a decline down to the $160-ish level may be in the cards. On the upside, bulls really need to see FB clear downtrend resistance and the 20-day moving average. That puts the 50-day and potentially higher back on the table. Top Stock Trades for Tomorrow 2: General Electric Click to EnlargeLook at General Electric (NYSE:GE) quietly trying to breakout. The stock pushed through a convergence of moving averages near $9.75 and is now well north of $10. Bulls need to see the stock hold above its three major moving averages. So long as that's the case, a breakout over $10.50 is in the cards. If it does, the February high near $11.28 is the first target. If $10.50 holds as resistance, bulls need to see its trifecta of moving averages hold as support. Otherwise, $9.50 and potentially $9 are on the table. Top Stock Trades for Tomorrow 3: The Trade Desk Click to EnlargeThe Trade Desk (NASDAQ:TTD) took a quick 6% hit on Wednesday on an analyst note, but recovered half of those losses by the close. It's left the stock bouncing off its 10-day moving average, but is otherwise just floating there. Where resistance came into play is no surprise. A close below Wednesday's low could get us a flush in TTD. Maybe only down to the 20-day moving average, but perhaps down to the 50-day moving average. I would love to see TTD back down in that $190 to $200 consolidation zone, but after a $50 rip in a week, I don't know if it will decline that far, (short of a broader market correction). If it does, I would consider it a buying opportunity. Otherwise, see how it trades through the rest of the week. If today's lows hold, a retest of its highs and channel resistance are in the cards. Top Stock Trades for Tomorrow 4: Alteryx Click to EnlargeAlteryx (NYSE:AYX) is ripping higher on Wednesday, with the stock up 10%. Along with TTD, these two stocks have been total studs and the gains shouldn't surprise InvestorPlace readers. After all, they are two of the seven mid-cap stocks to buy for big-time returns. So what now? AYX continues to bumble along against channel resistance, a mark that's been in place since the fourth quarter. Can AYX breakout over it? Of course, but I wouldn't bet on it happening. I'd rather potentially play the breakout after the fact than gamble on multi-month resistance suddenly giving way. However, I would certainly be a buyer on a pullback into the $87 to $92 area. Aggressive bulls may pull the trigger at $95 to $96. Top Stock Trades for Tomorrow 5: Adobe Systems Click to EnlargeAdobe Systems (NASDAQ:ADBE) reports earnings on June 18th. Usually we see some upside action ahead of the report as optimism grows. It's no secret this name has been a huge winner over the years, so optimism ahead of the print is not surprising. Above, you can see that the 50-day moving average is holding up, as is the backside of short-term downtrend resistance. That said, $285 has been a ceiling to ADBE while it has made three straight lower highs. * 7 Stocks to Buy for the Coming Recession I don't know how the stock will trade post-earnings, but as long as it holds today's lows, it could be good for a bounce in the coming days. Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long ADBE. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Buy for the Coming Recession * 10 Smart Dividend Stocks for the Rest of the Year * 5 Tech Stocks That Are Far Too Risky Right Now Compare Brokers The post 5 Top Stock Trades for Thursday: FB, GE, TTD appeared first on InvestorPlace.
Shares of The Trade Desk Inc. are off 4.5% in morning trading Wednesday after Instinet's Mark Kelley downgraded the stock to reduce from neutral. "We believe that the underlying fundamentals of the business, while relatively solid, are out of sync with near- to medium-term investor expectations and the story being told," Kelley wrote. He argued that The Trade Desk's total addressable market isn't $1 trillion if investors strip out Alphabet Inc. properties as well as social media. "What we're left with is a $41 billion market this year, which we estimate will grow in the high teens to low 20% range over the next few years to reach almost $60 billion by 2021, as programmatic penetration increases. We note that $60 billion is the value of the advertisements, not the revenue opportunity for TTD-assuming 20% take rates, we believe the revenue potential is $12 billion, roughly in line with TTD's $11 billion market cap." He kept a $144 price target on the stock, 40% below current levels. The stock has gained 105% so far this year, as the S&P 500 has risen 15%.
One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will...
These 5 stocks have delivered jaw-dropping gains so far in 2019. Despite a volatile market, these are the tech stocks that have still managed to seriously outperform. We are talking returns of 70% + in just over five months. That’s as the tech-heavy Nasdaq index enters correction territory amid ongoing regulatory concerns for the FAANG stocks. But the question is, do these 5 tech stocks still make compelling investing opportunities right now? Here’s what the Street has to say… Trade Desk- 100.16%At the time of writing, shares in Trade Desk (TTD – Research Report) have doubled year-to-date. That’s with a 15% burst in the last five days. The online advertising marketplace received a boost on Tuesday following comments from Federal Reserve chairman Jerome Powell that he would consider lowering interest rates to ‘sustain the expansion' of the US economy. What’s more, Pivotal Research’s Mark Levine upped his price target on TTD from $255 to $265 on June 5. This new Street-high price target indicates further upside potential of 14%. Levine sees continued share gains for TTD relative to other DSPs (demand-side platforms), adding that regulatory scrutiny of Google is a net positive for Trade Desk. However other analysts are more cautious. Oppenheimer’s Brian Schwartz’s $210 price target indicates 10% downside from the current share price of. Nonetheless, the analyst, one of the Top 10 ranked by TipRanks, reiterated his buy rating on TTD post-strong Q1 results and a better 2019 outlook.Schwartz stated: “Bottom Line: We believe that the combination of higher growth and margins versus other leading software vendors and the perception of being more aggressive on new and modern platform technologies than the competition will allow TTD to sustain a premium valuation versus the software industry.”View TTD Price Target & Analyst Ratings Detail Shopify- 111% E-commerce platform Shopify (SHOP – Research Report) has seen shares explode by 111% year-to-date. The company reported stellar results for Q1, and robust guidance for the year prompting the ongoing rally. Even in the last month shares have continued to climb 10%. But now analysts are calling for investors to take a breather. Indeed, Morgan Stanley’s Brian Essex has just downgraded SHOP from Hold to Sell. That’s with a price target of just $209- which translates to 29% downside potential from current levels. The analyst is concerned that much of Shopify’s revenue is transaction-based rather than subscription-based. Unlike transaction-based revenue, subscription-based revenue is recurring and therefore much more reliable. According to the latest earnings results, subscriptions now make up 44% of SHOP revenue down from 47% in the previous quarter. “The durability and scale of subscription models is one reason SaaS vendors are able to command high multiples,” says Essex. “We do not think Shopify has the potential to reach the terminal operating margin potential of its enterprise SaaS peers.”View SHOP Price Target & Analyst Ratings Detail Snap- 136%Out of all the stocks covered here, camera company Snap Inc (SNAP – Research Report) has recorded the best year-to-date performance. SNAP investors have been rewarded for their faith with remarkable returns of 136%. For Q1, the company revealed stronger than expected daily active user growth (~4 million adds), expanding average revenue per user, and even reduced operating losses. However the stock also shows the most cautious outlook from the Street, with the clear majority of analysts rating SNAP a Hold. The message from the Street appears to be that the current valuation has now largely factored in the positives, while competition remains intense. JMP Securities analyst Ronald Josey explains why he is staying on the sidelines here: "While we believe there are several catalysts for Snap in 2019, we point to the now-launched rebuild of its Android app, greater engagement with Snap Games & Discover, and an improved AR experience, as Snap now reaches 90% of 13-24 year olds domestically, we maintain our Market Perform rating, as we focus on engagement rates (we project DAUs to decline sequentially in 2Q) and we note the potential risks around Snap’s sales force reorganization."View SNAP Price Target & Analyst Ratings Detail Plug Power- 105% Trading at under $5, Plug Power (PLUG – Research Report) makes an interesting investing proposition. The company develops hydrogen fuel cells that offer increased productivity and lower operating costs compared to traditional batteries. Despite doubling in share price over the last few months, analysts still see over 40% upside potential ahead. And that’s with a ‘Strong Buy’ consensus based on all ratings received by PLUG in the last three months. Christopher Van Horn of B Riley FBR is upbeat about the company’s expansion from mobile fuel cells to material handling and on-road applications like electrical vehicles. “Plug Power continues to see strengthening business trends in core material handling markets, as well as lateral opportunities in on-road applications” wrote the analyst.“More importantly, we believe PLUG should achieve—and sustain—operating profitability starting in 2H19, a long-term goal that is finally in sight. We reiterate our Buy rating and $3.50 PT: We believe the company is better positioned in its core material handling business than ever before.”View PLUG Price Target & Analyst Ratings Detail Lattice Semiconductor- 99%Also in the ‘Strong Buy’ camp comes Lattice Semiconductor (LSCC – Research Report). The company has just held a bullish analyst day that emphasized share gains of its FPGA solutions in key communications, computing, industrial, and automotive segments. FPGA stands for field-programmable gate array, which essentially means that the user programs the device rather than the designer- offering very high levels of flexibility. Following the event, five-star Cowen & Co analyst Matt Ramsay reiterated his buy rating and $16 price target (16% upside potential). The analyst stated "Strategically, there were few surprises at the analyst day, as we believe new CEO Jim Anderson has his team laser focused on Lattice's differentiation in the low-power/small footprint FPGA market… New target model of double digit revenue growth and 62%+ GM appears achievable, with cost optimization driving a clear path to $1 EPS power.”Ultimately, Ramsay concludes: “We continue to believe the combination of Lattice's differentiated FD-SOI technology, and its competitive positioning as the only FPGA provider focused on low-power edge processing should allow it to benefit from several powerful drivers of secular semiconductor content." View LSCC Price Target & Analyst Ratings Detail Discover more 'Strong Buy' stock ideas from top analysts here
If you were to only look at shares of Shopify (NASDAQ:SHOP), you probably wouldn't know anything is wrong. For instance, the escalating trade war with China and now Mexico would not be a worry. Given how well Shopify stock has done over the past month, many observers might also overlook the fact that the S&P 500 has been down for four straight weeks.Source: Shopify via FlickrThere's no other way to put it: Shopify stock has been an unstoppable beast. Shares are still consolidating near the recent highs after more than doubling from its December lows and is up more than 130% in just over five months.At some point though, SHOP has to get off the rocket ship. That's just the way it is. Timing that departure is a lot harder than it seems though, given that it can happen very quickly and in a very painful fashion. Just see Nvidia (NASDAQ:NVDA) for proof.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThat brings up the question of, should investors buy Shopify stock at $250? * 6 Big Dividend Stocks to Buy as Yields Plunge Trading Shopify Stock Click to EnlargeSHOP stock price is backing off the $290 highs it was pushing last week. The fact that the stock can continue pushing new highs in this environment is incredible.I loved this name on its $155 breakout and subsequent retest where it held the 10-week moving average (purple arrow). But I didn't expect another $100+ to come so quickly.There's a lot of doubt surrounding this name thanks to its high valuation. Many argue, as they do for The Trade Desk (NASDAQ:TTD), Roku (NASDAQ:ROKU), Twilio (NYSE:TWLO) and other high-growth stocks, that Shopify stock is overvalued. They say the stock price can't support the business and that it's destined for collapse.The only problem with that theory? These shares double, triple, quadruple and more, all while these worries persist. Not being able to value it by traditional metrics makes it difficult to price a name like Shopify, but not impossible. Further, these stocks tend to get hammered during market-wide corrections.SHOP stock stood up stronger than its high-growth peers but still came in about 30% from the Q4 highs. A similar correction would bring us to $200 a share should we get similar summer volatility. That would likely be a solid buying opportunity, although many investors would still balk at that price.Unless the market really starts to implode though, it could be a while before we see SHOP stock this cheap. How about $250 then? Shares are down over 3% to start the week, down to $265. Another few days like that and $250 could be right around the corner. That would bring Shopify down to the 10-week moving average. This moving average has been guiding shares higher for all of 2019.This level needs to give way before any further downside is seen. Bottom Line on Shopify StockAggressive bulls will likely gravitate to SHOP stock at $250. This would represent a 12.5% decline from the highs. That said, if the market is turbulent enough, Shopify is sure to get hit harder than that. If it does, the 50-day moving average currently near $238 could come into play, while the May lows of $242 may also buoy the name.Below those marks and maybe we get the slippery-slope decline down to $200-ish.Understand one thing though. When companies cement themselves behind a strong brand with impressive growth, investors will almost always pay a premium. As for growth, SHOP stock has it.Estimates call for last year's revenue of $1.07 billion to grow 41% to $1.51 billion this year. 2020 estimates call for 32.5% growth to $2.01 billion in sales. Essentially, Shopify is forecast to double its revenue from 2018 to 2020. Better than that is its earnings growth, though.Estimates call for earnings of 58 cents per share this year, up 52.5% year-over-year from 38 cents per share. In 2020, forecasts call for earnings of 94 cents per share, up 62%. Even better though, the company has a solid balance sheet and is turning free cash flow (FCF) positive. Cash and short-term investments stand at about $2 billion, with just $100 million in long-term debt.At almost 20 times this year's revenue and near FCF neutral, I'm not making the case that SHOP stock is cheap. But it's a name for growth investors to own should they be able to scoop it up on a steep discount. Conservative growth bulls may bite at $250, but will certainly be interested near $200. Let's see how it does this summer.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long TTD and ROKU. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Sell Impacted by the Mexican Tariffs * 6 Big Dividend Stocks to Buy as Yields Plunge * The 10 Biggest Announcements From Apple WWDC 2019 Compare Brokers The post Shopify Stock Has a Dip Coming, and You Definitely Should Buy into It appeared first on InvestorPlace.
Volatility is back, and stocks are dropping. Whenever this happens, there are two really smart things investors should do. First, buy defensive names, because these stocks are inherently less subject to market volatility. Second, buy secular growth names, because these stocks will be able to keep growing even if economic and financial market volatility persists.With respect to secular growth stocks, one of the best secular growth sectors to buy into as volatility rises is the digital ad sector. Why? Because this is a secular growth market that won't stall out as a result of rising U.S.-China trade tensions.Broadly speaking, everyone and their best friend is becoming more addicted to the internet. That's why the global digital ad market grew at a 20%-plus clip in 2018. As that addiction continues to grow, more and more ad dollars will continue to flow in bulk into the digital channel. That's why this industry projects as a double-digit growth industry for the next several years. None of this will change because the U.S. and China are engaged in a trade dispute. Instead, the digital ad industry will continue to grow, and digital ad companies will continue to report healthy revenue and profit growth.InvestorPlace - Stock Market News, Stock Advice & Trading TipsUltimately, healthy revenue and profit growth will drive healthy gains in digital ad stocks, regardless of the trade backdrop. Because of this, now looks like a good time to buy some digital ad stocks on weakness. * 7 Stocks to Buy for Monster Growth Which ones should you be looking at? Let's take a look at seven digital ad stocks to buy on recent weakness. Facebook (FB)Source: Shutterstock At the top of this list is social media giant Facebook (NASDAQ:FB).Put simply, Facebook is the 300-pound gorilla in the digital advertising world, and it's only scratching the surface of its long-term potential. Between Facebook, Instagram, WhatsApp and Messenger, roughly 6 billion non-unique users across the globe are in the Facebook ecosystem, and those users spend hours a day in the ecosystem. Thus, Facebook has unprecedented reach and scale, which inherently gives the social media giant the best ad targeting capabilities.Still, Facebook is only monetizing about half of its 6 billion non-unique users, as Messenger and WhatsApp remain largely ad-free. Plus, Facebook is just starting on its commerce growth initiative, as digital commerce is a natural vertical that springs out of building the digital equivalent of a town square.Broadly, then, Facebook is a really big digital ad company that is only going to get bigger. As it does get bigger, FB stock will head higher. Alphabet (GOOG)Source: Shutterstock Following Facebook, we have the world's largest digital advertiser, Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL).Right now, there are some concerns related to Alphabet's digital ad business. Those concerns are well-founded. Broadly speaking, Alphabet's digital ad business was built for desktop, not mobile. Thus, as engagement has shifted to mobile, Alphabet's digital ad business has suffered, and this has resulted in a revenue growth rate slowdown and margin compression.But, it's important to put these concerns in context. Alphabet is still the world's largest digital advertiser in the world, by virtue of Google Search being the backbone of the global internet and YouTube being the second-largest social platform in the world, behind only Facebook. Alphabet's digital ad business is also still growing at a ~20% rate, and margins are starting to stabilize as TAC growth is moderating. * 7 Stocks to Sell Amid an Escalating Trade War All in all, then, Alphabet has had its struggles in the digital ad world, but through them all, this company remains the leader in the secular growth digital ad market. Because of this, Alphabet will continue growing at a healthy rate over the next several years, and that healthy growth will lead GOOG stock higher. The Trade Desk (TTD)Source: Shutterstock Lesser known than other names on this list, The Trade Desk (NASDAQ:TTD) is nonetheless one of the more exciting digital ad stocks in the market.The Trade Desk is a leader in what is called the programmatic advertising market. This market is simply data-driven automated ad purchasing, so that companies can take the guess-work and manual labor out of ad spend allocation, and instead trust The Trade Desk platform to optimize ad spend. This is exactly what is happening, and The Trade Desk continues to win ad dollar share at an impressive rate.This programmatic advertising trend will persist for the foreseeable future. In 2018, programmatic ad spend comprised roughly 25% of total digital ad spend. Back in 2016, that number was 22%. By 2030, that number will likely be well north of 30%. Meanwhile, The Trade Desk will continue to win share in this market. Back in 2016, TTD's programmatic ad spend share was under 2.5%. This year, it should be close to 4%.Thus, with The Trade Desk, you have a hyper-growth company rapidly gaining share in a hyper-growth market. Big share gains in a big growth market imply big growth potential for TTD over the next several years. That big growth potential will push TTD stock significantly higher in the long run. Twitter (TWTR)Source: Shutterstock Next up, we have Twitter (NYSE:TWTR), the once left-for-dead social media company that is in the middle of a huge turnaround.Once upon a time, Twitter's digital ad business was struggling to grow. Indeed, during a several quarter stretch a few years back, Twitter's digital ad business was actually reporting year-over-year revenue declines. But, that has all changed now. Over the past several quarters, Twitter has improved its digital ad capabilities, and the digital ad business has consequently turned into a 15%-plus growth business.This new growth trend should persist. Twitter has increasingly established staying power in the consumer internet landscape as a go-to place for crowdsourced sentiment and feedback on current events. At the same time, the company has proven itself as a viable advertising medium with strong targeting capabilities. Thus, at worse, this company should maintain share in the secular growth digital ad market for the foreseeable future. At best, the company actually continues to gain share. * 10 Heavily Shorted Stocks to Sell -- Because the Bears Are Right In either scenario, Twitter projects as a healthy revenue growth company over the next several years. Meanwhile, margins are ramping from a depressed base, and as they continue to do so, healthy revenue growth will turn into robust profit growth. Robust profit growth will push TWTR stock higher long term. Pinterest (PINS)Source: Shutterstock The youngest stock on this list, Pinterest (NYSE:PINS) is worth a look here because its digital ad business is very young, growing very quickly and it has the potential to be very big one day.Pinterest is a very big visual discovery platform that is still growing very quickly. The platform has roughly 291 million monthly active users, and grew that user base by 22% year-over-year last quarter. Yet, despite this huge user base, Pinterest doesn't have a big market cap. Pinterest's market cap is $14 billion, implying a market cap per user of under $50. Over at Twitter, market cap per user is up around $85.Why the huge discrepancy? Pinterest's ad business is much younger and smaller than Twitter's ad business. But, Pinterest's ad business is also growing very quickly (54% growth last quarter), as is the company's average revenue per user rate (up 26% last quarter). Given the company's huge user base, if Pinterest stays on this growth track of expanding average revenue per user, then Pinterest's ad business at scale could be enormous.If it does get enormous, then today's valuation -- market cap per user of under $50 -- is a steal. Naturally, it will head toward Twitter-levels around $85. That valuation expansion, on top of continued user growth, should propel PINS stock way higher over the next several years. Amazon (AMZN)Source: Shutterstock Not known for digital advertising, Amazon (NASDAQ:AMZN) is nonetheless a company that will leverage a rapidly expanding digital ad business to drive robust profit growth over the next several years.Amazon is an e-commerce behemoth. But, the e-commerce business is low margin, and those margins continue to be pressured by bigger and bigger competition. Thus, in order to supercharge profit growth, Amazon is looking into other high growth, high margin verticals. One of those verticals is digital advertising, since Amazon.com is one of the most visited websites in the world, Amazon has a wealth of consumer purchasing data to increase the effectiveness of ads, and the digital ad industry features high margins.Consequently, Amazon's digital ad business has had no trouble growing by leaps and bounds over the past few years. But, it's still relatively small, accounting for just about 4% of the digital ad market this year. Over time, that share will grow, implying huge growth potential for Amazon's digital ad business. * 5 Stocks Under $10 With Big Upside Potential The important thing is that as Amazon's digital ad business grows, margins across the whole business will be pulled higher, and profits will ramp. As profits ramp, AMZN stock will move higher. Roku (ROKU)Source: Shutterstock Last, but certainly not least, we have Roku (NASDAQ:ROKU), the connected TV platform that is a play on the huge shift in advertising dollars from linear to internet TV.Ad dollars always follow consumption, and consumption in the TV world is rapidly shifting from linear TV to internet TV. Consequently, ad dollars are similarly shifting from linear TV to internet TV. A big portion of those ad dollars are flowing into the Roku ecosystem, since Roku has established itself as an early leader in the advertising-video-on-demand (AVOD) space by amassing a user base of nearly 30 million internet TV streamers.Roku projects to remain a leader in this space for the foreseeable future. First mover's advantage is a real advantage here, since there are now 30 million consumers out there who are used to the Roku UI and want to stick to that UI. Further, Roku is dominating in the smart TV world, and most importantly, the platform is content-neutral, so you can access various streaming services without any complications.All in all, then, Roku projects as a big and important player in the secular growth AVOD market for a lot longer. That means Roku will be a big revenue and profit grower over the next several years, and all that growth should drive ROKU stock meaningfully higher.As of this writing, Luke Lango was long FB, GOOG, TTD, PINS, AMZN and ROKU. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Buy for Monster Growth * Ranking the Top 10 Stock Buybacks of Last Year * 5 Stocks Under $10 With Big Upside Potential Compare Brokers The post 7 Digital Ad Stocks to Buy for Massive Growth Potential appeared first on InvestorPlace.
There are two critical elements to identifying long-term winners in the stock market. First, find a secular growth industry, supported by secular growth trends with a massive addressable market. Second, find the top company or companies in that industry. Do those two things, and you've found yourself a long term-winning stock which you can buy and hold for the long haul.What exactly makes a company in a secular growth industry a "top" company? There are a lot of factors. But, arguably the most important is innovation. Simply, a company that innovates consistently in a secular growth industry is often one that is expanding its share in that industry. Companies that expand share in secular growth industries tend to consistently produce robust revenue and profit growth.And, ultimately, robust revenue and profit growth are what make stocks go higher. Thus, if you're looking for a long-term winning stock, look for an innovative company expanding share in a secular growth industry.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 6 Stocks to Buy for This Decade's Massive Megatrend Which stocks fit that description? Let's take a closer at 6 innovative stocks with big long-term growth potential. Shopify (SHOP)Source: Shopify via FlickrThe Industry: Direct-decentralized retailThe entire retail world is pivoting towards a direct-decentralized model. Broadly, the direct part is the result of the internet connecting brands/retailers directly to their customers, thereby removing the need for a middleman. The decentralized part, meanwhile, is the result of the internet democratizing the retail process so that anyone can sell anything to anyone through the internet.This model yields optimal outcomes for sellers (millions of new sellers can now compete with traditional sellers) and buyers (there's more supply, which inherently means lower prices and higher convenience). Thus, direct decentralized retail will continue to grow in popularity over the next several years.The Innovator: Shopify (NYSE:SHOP)The pioneer and leader in this market is Shopify. The company provides commerce solutions which enable and empower the millions of new sellers which comprise this direct decentralized retail model. Over the past several years, Shopify has continued to iterate, improve, and expand its suite of offerings.The net result is that the company has dramatically grown its market share in the commerce world, and continues to do so today. So long as this remains true, SHOP stock will remain on a long term winning trajectory. The Trade Desk (TTD)Source: Shutterstock Industry: Programmatic advertisingThe advertising world is increasingly shifting towards an automated ad transaction model. Broadly, this means that ad spend is increasingly being done using data-driven algorithms -- not humans and guess-and-check work -- so the ad-spend process is becoming smarter, more dynamic and more efficient than ever before. This process is called programmatic advertising. Given its multi-faceted benefits, it is the future of advertising.The Innovator: The Trade Desk (NASDAQ:TTD)The most exciting company in this space is The Trade Desk, a programmatic advertising company which has leveraged a differentiated product offering, aggressive product innovation, and platform neutrality to turn into the growth darling in the programmatic advertising space. Over the past several years, The Trade Desk has significantly and rapidly expanded its market share in the programmatic advertising market. * The 7 Best Stocks to Buy From the IPO ETF This trend will persist. As it does, The Trade Desk will continue to report great numbers, and those numbers will propel TTD stock meaningfully higher. Square (SQ)Source: Chris Harrison via Flickr (Modified)Industry: Digital paymentsAcross the global commerce space, there has been and continues to be a huge secular pivot from cash payments to non-cash payments, as consumers have increasingly adopted digital and card payment methods which are significantly more convenient. But, cash remains a big part of the global economy. Thus, there's still a ton of room for non-card payment methods to gain share over the next several years. As they do, companies which facilitate these types of payments will benefit from robust growth.The Innovator: Square (NYSE:SQ)The most innovative company in this space is Square. The payments processor has made a killing facilitating physical, non-cash payments for small to medium sized retailers. But, Square didn't stop there. Instead, they've subsequently expanded their physical offerings to be more attractive to bigger sellers, jumped into the digital payments space, created a suite of Services business, tested the waters in the banking world, and even built a food delivery platform.All in all, then, Square is innovating everywhere, and this rapid innovation has produced rapid market share expansion. So long as this continues, SQ stock will trend higher in the long run. Axon (AAXN)Source: Axon Industry: Law-enforcement technologyThe technology world is moving fast. But, the law-enforcement world has largely been left behind the technology curve. Until recently. Over the past several years, antiquated law enforcement agencies have undergone much-needed technology makeovers, which includes adopting things like smart cameras, smart weapons, cloud solutions and data-driven analytics services.These technology upgrades are happening with greater frequency and pace across the world. Soon enough, every law enforcement agency will be equipped with the latest and greatest tech.The Innovator: Axon (NASDAQ:AAXN)The pioneer, largest player and most innovative company in this space is Axon. Axon started out just selling Tasers to law enforcement agencies. Then, they pivoted into body cameras and dash cameras. Realizing the potential in the law enforcement tech world extended beyond hardware, they then pivoted into servicing the law enforcement world with cloud-hosted solutions to replace archaic on-premise solutions. * 3 Small Caps That Could Be the Next Amazon Stock Net net, the company has dramatically expanded its suite of law enforcement tech over the past several years, and in so doing, has dramatically gained law enforcement wallet share. This trend is still in its early stages, as Axon has dominated the domestic market but is only scratching the surface of its international potential. As the international growth narrative plays out, Axon's profits will run higher, and so will AAXN stock. Chegg (CHGG)Source: Rob Wall via Flickr (Modified)Industry: Digital educationThe internet has changed and continues to change many industries. One of those industries is the education world. In the education world, students are increasingly turning towards the internet for academic assistance. This includes on-demand tutoring services, online citation makers, online textbook answers and much, much more. As students turn in greater and greater frequency to the internet for academic assistance, there remains tremendous growth potential for a connected learning platform to capture and monetize all this demand.The Innovator: Chegg (NASDAQ:CHGG)The unprecedented leader and pioneer in the digital education space is Chegg. Broadly speaking, there wasn't an at-scale, digital connected learning platform in the market until Chegg came around. And, Chegg didn't start with connected learning. They started with textbook rentals and have increasingly pivoted into the digital education market over the past several years.Chegg continues to expand its connected learning platform today, so that students of all disciplines have a reason to turn towards the platform. Assuming this value and use-case expansion continues, then Chegg is on track to tap into all 36 million high school and college students in America in the future. Right now, they only have about 10% of that, so the long-term growth runway here is quite promising. Canopy Growth (CGC)Source: Shutterstock Industry: CannabisCannabis is now fully legal throughout Canada. This is just beginning. Given the overwhelming volume of research which suggests that cannabis isn't all that bad for you and the equally overwhelming volume of cannabis demand, global cannabis legalization isn't a matter of if. It's a matter of when.When it does happen, the global cannabis industry will be quite big. The trends are crystal clear. Over the past two decades, cannabis consumption among U.S. high school students has steadily increased, while tobacco and alcohol consumption have steadily decreased. Today, cannabis consumption rates are nearly equal to alcohol consumption rates among high school seniors.As such, once fully legal across the globe, the cannabis industry could measure as large as the alcoholic beverage industry, which is far in excess of $500 billion.The Innovator: Canopy Growth (NYSE:CGC)The leader and aggressive innovator in the cannabis space is Canopy Growth. Canopy is the biggest player in the legal Canadian cannabis market, with the largest growing footprint and the biggest volume and sales base by a wide margin. Further, Canopy is equipped with $4 billion on the balance sheet as the result of a big investment from alcoholic beverage giant Constellation Brands (NYSE:STZ).Canopy has been very aggressive with that $4 billion, including prepping a big launch into the U.S. cannabis market with the proposed acquisition of U.S. cannabis company Acreage. These aggressive investments will pay off in the long run. Canopy is giving itself robust and high quality exposure to every niche of the global cannabis market. As all those niches scale over the next several years, Canopy will scale, too. * 7 Marijuana Stocks to Play the CBD Trend Big picture, the company is positioned to one day be the leader in a $500 billion industry. If that happens, CGC stock will one day be worth a lot more than $16 billion.As of this writing, Luke Lango was long SHOP, TTD, SQ, AAXN, CHGG, and CGC. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 6 Stocks to Buy for This Decade's Massive Megatrend * The 7 Best Stocks to Buy From the IPO ETF * 7 Athletic Apparel Stocks With Marathon Pace Compare Brokers The post 6 Innovative Stocks With Big Long-Term Growth Potential appeared first on InvestorPlace.
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