2030 may seem a long way off but investors continually think about this distant future. When financial planners take over a portfolio, the average holding period is about eight years with focus on long-term goals like funding retirement or a child’s education, but rarely investment perspectives are considered beyond a year or two. In looking ahead to 2030, here are 6 highlights of the most existing and life-changing developments uncovered through global research efforts.
HEALTH CARE INNOVATION
It is highly suspected that by the year 2030, medical technological advancements will have made its way into our everyday lives. Such advancements could include devices that will analyze blood, monitor cardiology and breathing, and provide results within a matter of minutes.
There has already been massive waves of innovations across the health care sector. These innovations provide new opportunities for companies to potentially reduce overall costs, be able to provide better and more robust services, and improve the outcomes for patients. Some of these breakthroughs provide earlier detection of illnesses, diseases or a condition allowing for a more rapid speed of treatment before it progresses. One of the more exciting developments is the liquid biopsy, whereby a sample of your blood can be used to identify cancer at its earlier stages.
Healthcare, one of the largest and most complex sectors, is composed of a broad range of companies that sell medical products and services. The healthcare sector includes companies that sell drugs, medical devices, and insurance, as well as hospitals and healthcare providers. Some of the largest healthcare companies in the world include UnitedHealth Group Inc. (UNH), Pfizer Inc. (PFE), and Abbvie Inc. (ABBV).
The healthcare sector has caught investors’ attention since some of these companies have received regulatory approval for drugs to treat COVID-19 and begun distributing vaccines, and others are rushing to develop and win approval for new COVID-19 drugs. There are also companies involved in various other ways with combating the pandemic, such as supplying products to test for and manage treatments of the virus.
Here are the top three healthcare stocks with the best value, fastest growth, and most momentum.
pHARMACEUTICAL
A cure for cancer may be closer than you think with the advancements made in cell therapy, as some cancers will be cured between now and 2030. New reliable tests provide early detection of cancer formations and locations which could largely reduce the loss of life from this disease.
Vastly reduced costs and scientific development have contributed to phenomenal growth in this field which has companies investing aggressively to find unique ways to battle cancer and other illnesses. Treatments have been derived from genetic testing and has the potential to extend lives and generate billions in revenue from these developments.
The pharmaceutical industry is made of companies that research, develop, make, and sell drugs and treatments used to treat or eradicate diseases, and vaccinate people. This includes some of the largest and best-known companies in the world, such as Pfizer Inc. (PFE), Merck & Co. Inc. (MRK), and AbbVie Inc. (ABBV). A number of pharmaceutical companies, including Pfizer, have seen a surge in their sales after winning approval from U.S. and foreign governments for vaccines aimed at preventing the COVID-19 virus.
Over the last 12 months, pharmaceutical stocks, based on the iShares U.S. Pharmaceuticals ETF (IHE), have lagged the performance of the overall market. IHE's total return over the period was 19.3% compared to the Russell 1000's total return of 37.1%.
Here are the top 3 pharmaceutical stocks with the best value, the fastest growth, and the most momentum.
DIGITAL pAYMENT SYSTEM
The COVID-19 pandemic changed how people shop, study, and work, it also drastically transformed the way we pay for products and services. As people started gravitating towards online payment methods and mobile wallets like Apple Pay, the payments sector went through unprecedented digitization. According to Insider Intelligence estimates, digital payments boomed in the retail, real-time mobile P2P payments, remittances, and business payments areas, while the volume of mobile proximity payments reached $131.36 billion in 2020.
With this unforeseen but very real and rapid growth of digitization in the payments, sector, digital money and fintech companies are becoming a more attractive investment opportunity. The growth of the market from 2020 to 2025 is expected to be about 20%, reaching a market cap of $305 billion by the end of the forecast period. Despite, or perhaps because of, the outbreak of the pandemic, venture capital investment in the payments sector and fintech remained strong in 2020. According to KPMG, fintech companies managed to bring in $42.3 billion in venture capital investments during 2020, with the digital banking sector reporting the highest amount of venture capital investment for the year. Additionally, the strategic nature of venture investments in fintech resulted in $75 billion being poured into the sector by corporations in the US. KMPG has commented that because of the enforced move to a virtual and digital setting in light of the pandemic, the value of fintech sub-sectors and the like became more evident, with investors expecting more growth from the sector.
Here are the top 5 digital money stocks with the best value, the fastest growth, and the most momentum.
Coinbase Global, Inc. (NASDAQ: COIN)
Coinbase Global, Inc. is a provider of financial infrastructure and technology for the crypto-economy. The company offers primary financial accounts for the crypto-economy, a platform to invest, store, and spend, or otherwise use crypto assets, and a range of other services.
PayPal Holdings, Inc. (NASDAQ: PYPL)
PayPal Holdings, Inc. is a technology platform and digital payments company that works to enable digital and mobile payments for consumers and merchants across the world. The company’s payment solutions include PayPal, PayPal Credit, Braintree, Venmo, Xoom, Hyperwallet, and iZettle. On June 30th, PayPal Holdings, Inc. (NASDAQ: PYPL) launched its new digital solution for smaller businesses in the US, by the name of PayPal Zettle. The same month, the stock received a Buy rating from D.A. Davidson alongside a $325 price target, and Credit Suisse also kept its Outperform rating on the stock with a $315 price target.
JPMorgan Chase & Co. (NYSE: JPM)
JPMorgan Chase & Co. is a financial services company operating worldwide. The company, despite not being a traditional digital money player, is on our list of the best digital money stocks to invest in because of its recent moves into the digital payments and fintech sector with its acquisition of OpenInvest, for instance, which is a fintech company, and 55ip, another fintech company.
This July, JPMorgan Chase & Co. (NYSE: JPM) was given a Market Perform rating and a $167 price target at Keefe Bruyette. The stock was also dubbed one of the top stock picks in the financials sector this June and raised its dividend after the Federal Reserve’s stress test to about $1 per share, making it a good choice for income investors.
Square, Inc. (NYSE: SQ)
Square, Inc. is a creator of tools to enable sellers to accept card payments and provides reporting and analytics alongside next-day settlement. The company’s hardware products such as the Magstripe reader enable swiped transactions of magnetic strip cards, and it offers a range of related products and services. Square, Inc. (NYSE: SQ) CEO Jack Dorsey has also mentioned that the company might be making a hardware wallet for bitcoin, resulting in a rise in the stock’s popularity this June. In the first quarter of 2021, Square, Inc. (NYSE: SQ) had an EPS of $0.41, beating estimates by $0.25. The company’s revenue was $5.06 billion, up 266.17% year over year and beating estimates by $1.71 billion, and it has a gross profit margin of 24.07%. The stock has gained 5.48% in the past 6 months and 14.22% year to date.
Green Dot Corporation (NYSE: GDOT)
Green Dot Corporation is a fintech and bank holding company in the US. The company has two segments: Account Services, and Processing and Settlement Services. This June, in light of a collaboration with Walmart Inc. (NYSE: WMT) on the Walmart MoneyCard to provide demand deposit accounts for retail customers, Green Dot Corporation (NYSE: GDOT) gained about 4%. The stock was also among the top outperformers this June in the financial sector. As of this May, Truist has retained its Buy rating on Green Dot Corporation (NYSE: GDOT), while Barclays retained its Overweight rating on the stock up till the month before. In the first quarter of 2021, Green Dot Corporation (NYSE: GDOT) had an EPS of $0.83, missing estimates by -$0.04. The company's revenue was $379.81 million, up 9.6% year over year and beating estimates by $19.47 million.
SMART TECHNOLOGY
With the technological advancements we have seen happen over the last 50 years, it is no surprise that this advancing trend continues to this day and is expected to continue for many more years to come. Advancement in everyday devices has allowed for the transformation of how we work, eat, sleep, and live. Devices such as smart phones, fitness trackers, health monitors, wireless earbuds that can translate languages, smart glasses, augmented reality, laptops, and tablets have paved the way for massive changes in tourism, travel, and our economy.
The technology sector is composed of businesses that sell goods and services in electronics, software, computers, artificial intelligence (AI), and other industries related to information technology (IT). The sector includes companies with the largest market capitalizations in the world, such as Apple Inc. (AAPL), Microsoft Corp. (MSFT), and Amazon.com Inc. (AMZN).
Tech stocks, represented by the Technology Select Sector SPDR Fund (XLK), have outperformed the broader market over the past year. XLK has provided investors with a total return of 38.3% over the past 12 months, above the iShares Russell 1000 ETF’s total return of 36.8%.
Here are the top five tech stocks with the best value, fastest growth, and most momentum.
DIGITAL ENTERTAINMENT
Digital entertainment is taking center stage in the wake of the global pandemic with the shift to streaming content from movies and tv to gaming platforms. Roughly one-third of all content is currently viewed via streaming, but within 10 years, it will more likely increase to two-thirds if not more. The popularity in streaming comes from the combination of being both better and cheaper than traditional television. Streaming provides a platform that can reinvent its content continuously to fit its viewers needs. The same could be said for the video game industry in terms of robust platforms that are ever evolving its technology and content to draw in more users and with digital content, there is no need to buy a disc game anymore, you simply click to buy, download and enjoy!
Here are the top four tech stocks with the best value, fastest growth, and most momentum.
LiveNation (NYSE: LYV)
LiveNation is the world’s biggest live entertainment company. This alone qualifies them to be one of the top entertainment stocks to buy. Every year, it organizes about 40,000 shows, sells 500 million tickets globally, and employs about 44,000 people. Its main three business lines are concerts, ticketing, and sponsorships. One of the main ways that Live Nation forecasts its business is to look at ticket sales. According to Ticketmaster, this past June was North America’s fourth best month ever for transacted ticket volume. Live Nation is finally putting on shows and selling tickets again. And people are gobbling it up. Lots of events are selling out in record time. This despite tickets being priced 10% higher than 2019.
Looking forward into 2022 and 2023, Live Nation stated that “all leading indicators point to a roaring era for concerts and other live events”. LiveNation’s stock is up 40% YTD and 264% over the past 5 years.
Roku (Nasdaq: ROKU)
There’s a good chance that you’ve used a Roku before even if you didn’t realize it. Roku builds those little streaming sticks that plug into the back of your TV. The streaming sticks look and operate a little bit like an Amazon Firestick. After a quick installation, Roku gives you access to pretty much any streaming service you want. The cheapest option starts at only $24.99 so they’re very affordable.
Roku is one of the secret winners during The Streaming Wars. While everyone is going crazy arguing over which streaming platform is the most popular, Roku is quietly profiting either way. It’s a little bit like how Apple makes money regardless of which app is No. 1 in the app store. Roku’s business is also growing incredibly quickly. Here are a few takeaways from Roku’s quarterly report on August 2:
Total net revenue grew 81% year-over-year (YoY) to $645 million
Platform revenue increased 117% YoY to $532 million
Gross profit was up 130% YoY to $338 million
Roku’s stock is up just 1.7% YTD and up 1,110% over the past 5 years. If you want to go with another stock to capitalize on the streaming trend, Netflix is another good choice.
GameStop (NYSE: GME)
Esports and gaming is a huge industry – both in the U.S. and globally. Last year, consumers spent about $44 billion on gaming. Additionally, about half the U.S. population are monthly gamers. GameStop could position itself perfectly to make a dent in this market. GameStop is already a nationally recognized brand and has a loyal following of gamers who grew up visiting its stores. A few pivots in its core business could turn GameStop into one of the top digital entertainment stocks to buy.
One person who recognized this is Ryan Cohen, the billionaire founder of Chewy.com. Cohen bought up 12% of GameStop stock and joined its board. He has a plan to turn GameStop into the Amazon of Gaming. This plan mainly involves shifting GameStop from a retailer to an eCommerce company.
GameStop’s stock is up 972% YTD and up 629% over the past 5 years. Keep in mind though that these increases are largely due to the short squeeze from earlier this year.
Penn National Gaming (Nasdaq: PENN)
Penn National Gaming is North America’s largest gaming operator. As a gaming operator, it does a little bit of everything. It operates 43 destinations in the U.S. where people can gamble, watch horse races, eat/drink, see a show, and get a room for the night. Penn National has a business model that entertains in a number of ways. This makes it one of the perfect entertainment stocks to buy for the Roaring 20s.
However, what makes Penn National Gaming a particularly great entertainment stock is that it owns the Barstool Sportsbook. In 2020, many live sporting events were either canceled or had small crowds. If you’ve watched a game in 2021 then you know that arenas have been filled to the brim.
Sports betting has always been big in the United States. The difference now is that it’s becoming a big legal market. In 2020, the sports betting market generated about $1 billion in revenue. This is during a time when sports betting is only legal in about half of U.S. states. Forbes projects that revenues could exceed $19 billion if betting gets legalized in all 50 states.
With its acquisition of Barstool Sportsbook, Penn National is in a good position to become a leader in this industry. Additionally, Penn National also recently acquired Score Media and Gaming. This further bolsters its position in sports betting. Keep in mind, Penn National’s stock is down 7% YTD. But it’s up 453% over the past 5 years.
RENEWABLE ENERGY
The next decade will bring about many changes to the way our world is powered. A dramatic shift toward renewable energy is already underway. A green energy transition is in it’s early stages but has a force behind it that could drive growth through to 2030 and beyond. Automation and AI are setting the stage for a golden age of renewables which will push down costs while boosting productivity and efficiency. The idea of renewable energy as been deemed expensive and impractical but that is quickly changing with the advancement of technology. Traditional utilities are already generating more than 30% of their business from renewables.
The renewable energy sector is comprised of companies that engage in the generation, distribution, and sale of renewable and clean energy, as well as related products and services. Examples of renewable energy sources include solar, wind, hydroelectric, and geothermal. The growing list of names in the sector includes companies like Israel-based SolarEdge Technologies Inc. (SEDG), Brazil-based Companhia Energetica de Minas Gerais (CIG), and First Solar Inc. (FSLR).
Renewable energy stocks, as represented by the iShares Global Clean Energy ETF (ICLN), have outperformed the broader market, posting a total return of 45.1% compared to the Russell 1000's total return of 34.8% over the past 12 months.
Here are the top 3 alternative energy stocks with the best value, the fastest growth, and the most momentum.
The IDEA Club
JASON a. JONES, aams
ABL FINANCIAL
Jason has been a financial advisor since 2011. He worked for Edward Jones for eight years before founding ABL Financial. He is very active in his Rotary Club where they focus on raising funds for high school students to go to college or trade school. Jason is also active in the Mississippi State Greater Orlando Alumni Association. They assist students from Central Florida that attending Mississippi State. He was graduated by Mississippi State University in 2004 with a Bachelor’s in Business Administration.
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