Confluent: The Best Metaverse Stock To Buy Now?

When filmmakers depict the world of the future, technology plays an outsized role. Augmented reality, holograms, as well as synchronal integration of the physical world and the virtual world create personalized experiences that are only limited by the speed of data. 

Developers and innovators are on the cusp of bringing those imagined futures to life, and some companies have made bold commitments to pursuing what is being called a metaverse. One of the most public moves was Facebook’s 2021 decision to change its name to Meta. With that, the company made a statement that it intends to play a leadership role in creation of the metaverse. 

Certainly, a true metaverse requires the type of technology that Meta is working to advance – the infrastructure that will allow people to move through digital environments as easily as they move through physical ones.

Other companies involved in building the metaverse include the names you would expect – Apple and Microsoft, for example. There are also a number of less familiar names like Decentraland, Epic Games, and Niantic. 

However, even the most sophisticated metaverse builders can’t succeed without a certain core element. That core element is data – specifically, the ability to collect, analyze, and adjust based on results in real time. The amount of data in question is incomprehensibly large, and most organizations simply can’t manage it contemporaneously. Confluent (CFLT) has the solution, making it the best metaverse stock to buy now.

Is Metaverse Real?

Before the internet, computer buffs imagined how such a creation might function. While they got some things right, most of their ideas were inaccurate. More importantly, they didn’t think big enough, and many of the features taken for granted today were simply inconceivable fifty years ago. 

The metaverse is something like that. There are metaverse-like virtual worlds already in use, and innovators are adding new capabilities and additional metaverse “real estate” every day. However, it is likely that decades from now, the metaverse will be far different from any description published as it begins to emerge. 

Today’s metaverse has its foundation in massively multiplayer online role-playing games (MMORPG) like World of Warcraft and Fortnite, which have been around for a number of years.

Second Life is a similar concept, though its creators object to it being called a game. Essentially, these are virtual worlds that continue to exist whether or not an individual player is logged in. 

From there, companies like Roblox (RBLX) were inspired to bring other types of virtual worlds to life. On the Roblox platform, users can meet up with friends and move in and out of online games together. They are represented by online avatars that interact with each other and the virtual environment. 

The metaverse isn’t just for gamers – it is taking over the business world as well. While video conferencing isn’t especially new, the pandemic accelerated the adoption of virtual meeting platforms, prompting more sophisticated software and improved features. 

Ultimately, companies invested in building the metaverse envision an immersive experience in which users participate in virtual activities as seamlessly as they might in the physical world. Attending meetings, enjoying live concerts, and touring new places will be possible from the comfort of home.

Some of that metaverse is real already, and the technology for growing and expanding the metaverse already exists. What might come later as technology grows more advanced is anyone’s guess. 

What Is Metaverse Stock?

Investors are focused on metaverse stock because the technology sector has delivered some of the market’s biggest gains over the past 20 years.

For perspective, consider this: the S&P 500 is often viewed as representative of the US economy as a whole. As of late 2021, the FAANG stocks – Meta Platforms (FB), Apple, Amazon, Netflix, and Alphabet (GOOG) – made up approximately 17 percent of the total S&P 500. 

The tech sector as a whole was roughly a quarter of the total S&P 500 at that time. That’s more than healthcare (approximately 13 percent) and financial (approximately 11 percent) sectors combined. It’s no wonder, then, that investors are anxious to identify the best metaverse stocks to buy now. 

Can You Invest In Metaverse Stock?

There isn’t a single company that owns the metaverse, so you can’t invest in metaverse stock per se – just as you can’t invest in internet stock or autonomous vehicle stock. However, you can invest in the stocks of companies building the metaverse, creating the necessary infrastructure, and otherwise providing critical components of the metaverse. 

Some examples have already been mentioned, including Apple, Decentraland, Epic Games, Microsoft, and Niantic. Other options include companies like Activision Blizzard, Matterport, NetEase, Nvidia, Take-Two, Tencent, and Unity Software, all of which play a key role in the future of the metaverse.

One company has set itself apart from its metaverse peers by developing a product that solves the biggest problem businesses face – and that company has no competition. Most industry analysts agree that when it comes to the metaverse, Confluent is the hottest stock to buy now.

What Is The Hottest Stock To Buy Now?

Confluent (CFLT) is the top pick in terms of the hottest stock to buy now because it is doing something unique – and its software is a must-have for just about every large company. Essentially, Confluent has mastered the use of Apache Kafka and made it possible for companies to put their collected data to use in real time. 

Apache Kafka is open-source software, which means – in theory – that it could be implemented without any help from Confluent. However, in practice, Apache Kafka is difficult to manage and nearly impossible to scale up for large enterprises. The thing is, Confluent has done it.

Confluent created a platform that can leverage the power of Apache Kafka for companies of any size, and in-house tech teams don’t have to be experts in the nuances of Apache Kafka software. 

In simple terms, businesses collect huge amounts of data – for example, transaction information, customer details, and so forth. The quantity of data is so vast that the practice of collecting and analyzing it is referred to as “Big Data.” Pre-Apache Kafka and pre-Confluent, there was no way to analyze and act on insights from big data in real time. The data was stored away and analyzed later. 

That’s useful for looking back and using historical information to build new processes, procedures, and strategic plans, but it doesn’t solve problems or customize experiences in the moment. The Confluent platform makes it possible to pull in data from multiple sources, sort, analyze, and report as events occur. 

Instant feedback allows highly-personalized customer experiences and immediate detection of fraudulent transactions. It allows businesses to monitor operations and logistics more closely, so adjustments can be made when conditions change almost instantaneously. 

Metaverse or no metaverse, Confluent has an invaluable product that offers instant advantages for its clients. As the metaverse grows larger and more complex, it simply can’t function without real-time data flow and processing. That makes Confluent the hottest stock to buy now. 

Confluent vs Competitors

Confluent was founded in 2014, and it signed its first major client (over $1 million in Annual Recurring Revenue – ARR) in late 2017. By the second quarter of 2018, the company was over $100 million ARR, and it had more than 1,000 clients by the end of first quarter 2020. 

That figure increased to 2,500+ clients within 12 months, including names like Bosch, Expedia, Home Depot, Ing, and Block (SQ).

It is worth noting that more than 20 percent of the Fortune 500 companies are Confluent clients, and they make up around 35 percent of the company’s total revenues. Churn is negligible – it seems that once clients sign on, they realize they simply can’t go back to the pre-Confluent days. 

What makes Confluent a particularly interesting stock for investors is that it essentially has no competitors. There are no other companies offering simple, scalable Apache Kafka solutions. At most, an ambitious organization might try to develop something in-house. 

How Confluent Makes Money

A common question is how Confluent makes money. Fortunately, the answer is straightforward. The software is available as a self-managed software platform that can be implemented on-site, through a private cloud, or using a public cloud. 

Alternatively, users can choose software-as-a-service (SaaS). Clients sign on for a specified term – one or more years – and pay for their subscription, or they choose a pay-as-you-go plan. There are also options for usage-based minimum commitment contracts that are typically written for a year or more. 

Is Confluent The Best Metaverse Stock?

So, is Confluent the best metaverse stock? Many industry experts and analysts say yes. It offers a unique product with endless applications and, to date, has little or no competition. Confluent is on a rapid growth trajectory, despite the fact that tech companies, in general, are seeing a bit of a lull. 

Since its June 2021 IPO, Confluent has risen more than 70 percent at a time when two-thirds of 2021’s IPOs are trading below their initial price. There is every reason to believe that demand for Confluent’s Apache Kafka management services will continue to grow, which means shareholders may see high returns long-term. 

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