Stocks To Buy Your Grandkids: A whirlwind of new technology has dramatically altered daily life over the past 20 years. Widespread adoption of the internet and the subsequent digital transformation have changed how businesses operate. Employees have new tools and resources that increase efficiency, automate repetitive tasks, and simplify virtual collaboration.
Schools aren’t limited to in-person classrooms anymore. Teachers and professors have endless options for delivering educational materials online. This has increased access to learning and created innovative methods of enriching learning experiences.
Technology has impacted leisure time, as well. It has given families alternatives to making the trek to brick-and-mortar stores, and there are endless forms of digital entertainment to enjoy from the comfort of home.
The increased adoption of IoT (Internet of Things) devices with smart technology capabilities has given people better control over home maintenance tasks and security, and it seems that the addressable market for such items is practically unlimited.
Certain companies have been instrumental in building the technologies of the future. Most of them have enjoyed rapid growth as they introduced new tools and services to the market. That’s great for shareholders who got in on the ground floor, but not all of these stocks are still a smart buy.
Some of the biggest tech stocks have peaked, and others enjoyed temporary success they couldn’t sustain. However, a few tech stocks continue to innovate, building upon existing products and services or creating entirely new ones. Those stocks still have plenty of room to grow, making them ideal choices for long investment horizons.
These are three stocks to buy your grandkids if your goal is to set them up for long-term investment success.
Will Apple Stock Go Up?
Apple is one of the most successful companies in history. Since Apple went public, shares have returned nearly 250,000 percent, and its market cap stands at $2.80 trillion as of mid-August 2022.
Legendary investor Warren Buffett has signaled his confidence in Apple by putting more than 40 percent of Berkshire Hathaway’s portfolio into Apple stock.
Every time share prices dip, Buffett buys more. Some industry experts question whether Apple can maintain its rapid rate of growth. After all, with its current size in mind, is there really room for Apple to expand?
If Apple iPhones were the company’s only source of revenue, it is likely that Apple’s ability to expand would be limited. Though iPhone users are extremely loyal and can be depended on to upgrade within the Apple family of smartphones, there is a cap on how many iPhones Apple can sell.
Fortunately for Apple – and its shareholders – Apple doesn’t intend to be stifled by over-reliance on a single product line. It has an active research and development division that is dedicated to creating the technologies of the future.
On top of that, Apple is deeply involved in the growing services market and has introduced several popular, high-margin products such as Apple Music and Apple TV. Remember, Apple already has a captive user base, which means an exclusive market for subscription services.
Most analysts have rated Apple stock a buy, and they fully expect share prices to go up in the coming year. Investors with a longer investment horizon, including those who want to build a legacy for their grandchildren, can count on Apple to continue delivering solid returns for the foreseeable future.
Is Alphabet Stock A Buy?
Google might be Alphabet’s biggest claim to fame, but it is by no means the only project in the works. Alphabet owns Android, Nest, the Chrome web browser, YouTube, and Google services like Google Maps and Google Play.
It is also one of the top three providers of cloud computing services, and it offers highly rated productivity tools like Gmail, Google Drive, and Google Meet.
Thanks to Google’s firm hold on the global search engine market, the company generates massive advertising revenue. That ensures Alphabet has the cash to invest in research and development, and it is putting its money to work on innovation.
Alphabet regularly funds crypto startups, and it is working on healthcare-specific tools and resources. It has an entire segment devoted to smart cities, and it is breaking new ground in Artificial Intelligence (AI) and machine learning.
The price of Alphabet’s Class A shares has gone up nearly 5,000 percent since they started trading publicly, and Alphabet’s market cap stands at $1.57 trillion. That’s enough to make investors nervous about the company’s capacity for continued growth.
However, the sheer expanse of Alphabet’s business and its penetration of various markets puts it in an excellent position to continue on its expansion path.
All in all, most analysts agree that Alphabet has plenty of room to grow, and nearly all have rated Alphabet stock a buy. As its non-search-engine technology starts to take off, Alphabet will enjoy diversity in revenue streams, ultimately making it a stronger company.
Is Amazon Stock Expected To Rise?
Amazon is best known for its dominance in the e-commerce space, but that is rapidly becoming secondary to its second major division: cloud computing. Amazon Web Services (AWS) controls a third of the cloud computing market – more than its two biggest competitors combined.
The combination of these two business units puts Amazon at the intersection of two in-demand technologies. The transition from brick-and-mortar stores to e-commerce is taking place more quickly than anyone expected, and the move to cloud-based software and storage is the top technology project for most large businesses.
Both of these areas are expanding thanks to greater adoption among users. As a result, Amazon stock is quite likely to maintain its high rate of growth, which currently totals nearly 158,000 percent since its inception. The beauty of having these two divisions is that they even out economic ups and downs.
In a post-pandemic environment, AWS revenue makes up for the dip in the e-commerce business. Pre-pandemic, e-commerce propped up AWS.
Amazon isn’t content to stop with e-commerce and cloud computing, though it has already reached a market cap of $1.45 trillion. It is hard at work expanding its digital ad services, and it appears that the company intends to compete head-to-head with Google.
When examined as a whole, there is every reason to believe that Amazon stock will go up indefinitely, which is why most analysts have rated Amazon stock a buy. In short, Amazon stock is a smart choice for long-term investors.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.