It’s rough there for investors. The S&P 500 now sits more than 22% below the January peak, reaching a new 52-week low just last week as a result of the pullback. And it seems like the stocks could move even lower before all is said and done.
Although hard to do now, however, investment experts will tell you that this is the time to buy rather than the time to panic. We don’t know if the market is exactly below it right now, but we do know that stocks are cheaper now than usual. Five years from now, timing the actual low point of the market is less important to those with long -term investment plans.
With that as a backdrop, if you have an extra $ 3,000 you won’t need anytime soon, here’s a rundown of three of the best options you can feel good about adding to your long -term portfolio.
Yes, online marketplace behemoth Amazon (AMZN 2.47%) ran into the wall of inflation in the first quarter of the year. Its typically profitable e-commerce operation has actually lost money here and abroad in the three month stretch in question. And since freight costs and employee fees have only grown since then, don’t even look for its online sales to get back in the black for the second quarter, either. Concerns about the lack of profitability may be one of the main reasons why Amazon’s share prices have dropped 37% since late March.
However, what this underlying skepticism overlooks is how the sale of goods is no longer the primary driver of Amazon’s business growth. Its main moneymaker is cloud computing. In 2021, before inflation starts to spread and drag the company’s e-commerce arm into the red, Amazon Web Services will reach 75% of Amazon’s operating revenue despite making up only 13% of its top line. Moreover, AWS’s operating revenue rose 37% annually-growth that accelerated to 56% in the first quarter of this year.
And not just AWS. In February-for the first time-the company announced how much advertising revenue it is making today. Last year’s tally of $ 31.2 billion was impressive, in a nutshell, with its fourth quarter ending the year with 32% year-on-year growth. And just getting started.
Ironically, Amazon may make more revenue from selling ads for the goods it offers than it actually did from selling the goods.
2. SolarEdge Technologies
There has arguably never been a better time to invest in solar power. Oil and natural gas prices are on the roof, dramatically rising consumer utility charges. Cultural and political support for clean, renewable energy has also not been more robust. The end result? The U.S. Energy Information Administration (EIA) estimates that approximately half of the nation’s electricity production capacity growth this year will come from solar panel installations. However, it still scratches the surface. The EIA also states that at the end of last year, less than 3% of electricity in the US came from solar. This leaves more room for solar growth.
Enter SolarEdge Technologies (SEDG 8.44%).
As the name suggests, it’s a solar power play, but it’s not a panel maker – an aspect of the business that has not only become commoditized but increasingly politically complex. For example, President Joe Biden recently suspended tariffs on some solar panels imported into the U.S. to support his clean energy agenda, but some say the reprieve unfairly favors foreign manufacturers over those. makes the US panel.
Instead, SolarEdge makes and markets solutions that are now more important to the business than the panels themselves: the way the solar power is managed by the panels. In addition to monitoring systems, its tech manages energy storage systems, and can be easily integrated into electric vehicle charging stations.
The all-in-one platform is well-received by the public if the company’s top and bottom line predictions are any indication. Analysts are collectively calling for revenue growth of 55% this year to be followed by 26% growth in 2023. This in turn should double SolarEdge Technologies revenue in 2021 of $ 4.81 per share to $ 9.68 next. that year.
3. Service Today
Finally, add Service Today (NOW 3.67%) on your list of stocks to buy if you have $ 3,000 burning in a hole in your pocket.
It’s not a household name, but there’s a good chance that you or someone in your household has been affected – for the better – by its product. ServiceNow offers businesses a way of building customized digital workflows without the need for computer coding.
And it works. It is a very powerful platform, in fact, the IT research outfit Gartner named ServiceNow the single best company in the IT service management space for 2021, marking the eighth consecutive year it is at least one of the best in this part of the tech sector. Organizations from professional sports leagues to universities to other technology companies are plugged into the ServiceNow platform in one way or another, and even better for it. For example, Infosys Limited says ServiceNow features save up to 45% of its help desk agents ’time. Ultimately, that saves money, which is why ServiceNow’s top line has been and continues to grow at almost 25% per year.
There is no end in sight for this growth, either. The workflow automation movement is expanding so fast that Gartner is already starting to use the term “hyperautomation,” which it predicts will be a nearly $ 600 billion market this year, up from $ 532 billion last year. Gartner added that by 2024, organizations will collectively use hyperautomated workflows to reduce operating costs by 30% from current levels.