Despite the unprecedented strain on the economy from the coronavirus, the S&P 500 is up 12% year to date, defying predictions across the board. With so many stock winners this year, investors understandably want to know what hot stocks to buy as we close 2020 and head into 2021.
Tapping the brakes, 2020 has clearly demonstrated it’s extremely challenging to predict stock prices in the short term — and yes, I consider one year to be short term. But the longer you extend your time frame, the easier predictions become. Envisioning how business trends can play out over a decade is easier than nailing down how the market will react to developments day by day.
So rather than ask what to buy for 2021, how about you extend your horizon over the next decade? If you’re up for the challenge, here are three long-term trends worth betting on and the companies poised to benefit from them between now and 2030.
Bet on connected TV
Have you noticed how many streaming-video services there are these days? There’s a reason for this. Media companies know there’s been a clear shift among viewers. They’re leaving traditional TV sources like cable and switching to on-demand streaming through smart TVs and over-the-top hardware providers. Most of these media companies generate revenue from advertising, so they must follow viewers by launching their own streaming services on connected TVs. Powering the entire revolution is Roku (NASDAQ:ROKU).
There are already 46 million active accounts on Roku, growing at a rate of 43% year over year. Not only did a recent survey show Roku is the market-share leader in the space and has the highest satisfaction rating among users, but also one in three new smart TVs in the U.S. is powered by Roku. These factors mean Roku has the users now and will likely continue to be the streaming-video operating system of choice.
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