Trading in the stock market is all about timing. But investing in it is more about finding concepts that will be captivating for years to come. We currently have several of those that are sure to stick around for at least 10 years. Today, we will examine three hot stocks Amazon (NASDAQ:AMZN), Uber (NYSE:UBER) and IBM (NYSE:IBM) for the role they will play in shaping our future and our investment portfolios along the way.
First is retail, which as a sector is struggling but within that there are stars that are causing the rest to struggle. These are winning stocks that will continue to win for as long as people need to buy and need their services. In that category today we have two stops to consider: Amazon and Uber. These are two companies that will continue to shape the future of how humans conduct their daily lives.
Also today we will dissect the role that machines will play in the way we evolve. Artificial intelligence is a term we throw around these days, but this is a technological term that has lingered for decades. It is only now coming into the mainstream, so it’s safe to say that its best days are ahead.
Once it takes hold, the AI trend will not digress. Humanity will continue to test the limits of what machines can do. And if the experts are correct, machines will then join the process of building their own successors that are even better than them.
Meanwhile, next to UBER and AMZN, IBM has been leading AI for decades already. So it is safe to assume that they will continue to lead in this category.
Today, the market is near its all-time high and it’s easy to be scared out of fears of a correction. But Amazon, Uber and IBM are safe long-term, Warren Buffet-style bets. This is hard to do in this age where instant gratification is a way of life, but it’s the right thing to do.
So if I buy any of these stocks today, I don’t expect to get rich by tomorrow or next week. These are stocks to own through thick and thin as we work through this battle between bulls and bears over the next few hundred S&P points.
AMZN stock is a beast that has decimated all the those who dared short it in its early days. So this is the picture-perfect long-term winner stock to own through thick and thin.
Since it never stopped growing, it can retain is brand of a hyper growth stock. If the stock market is higher ten years from now then Amazon stock will definitely be at the top of the charts. Year-to-date, AMZN is up almost 40%. And in five years it is up 545%, which is ten times more than the S&P 500.
They have completely changed the ways the world shopped. Along the way, they also change a few other industries even in tech. They beat out giants like Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL). Amazon’s AWS now dominates the proverbial cloud that runs almost everything online.
Only in hindsight and in the future will we find out what else they will have in store for us. Under the leadership of CEO and visionary Jeff Bezos that is an awesome and bankable team. Amazon stock has no limits for as long as these are facts.
There will be rough patches for the next few weeks as the FANG gang report earnings but we are not sniping for perfect entry points today. This is a fast moving stock and it will cause elevated levels of anxiety if monitored too closely.
If we listen to the critics of the IPO earlier this year, UBER is not an obvious choice for the long term, but that is short-sighted. Yes, the process of going public wasn’t ideal, but this was a gigantic unicorn that had no template of how to do it.
Since then, management has not disappointed. They are focused on their own business unaffected by the media coverage and criticism. In spite of the doubters, Uber is definitely a hot stock to buy for the next decade. In its short life, it managed to disrupt and completely change the way people moved. This is a global statement, meaning it’s not only in one region. This is a formidable effort and a team that can accomplish that is definitely one I want to join.
Moreover, there are tons of doubters who point out margins as a detriment to Uber’s future. But just like AMZN in its early days, UBER has to spend money to grow, especially if it wants to continue to change the world. The proof of concept is that are Uber Eats and Uber Freight. These are the first two ways it differentiates itself from the competition like Lyft (NASDAQ:LYFT).
UBER is not solely in the business of moving people anymore. This will become only but a small portion of their overall revenues. I see them dominating several verticals much like Amazon. It is difficult for many to see this now, but it will soon become clearer as other verticals, especially Freight, will grow and surpass the original concept. There is no limit to what they can do next and that alone is reason to hold UBER — the hottest stock to buy for the next decade.
I’ve been a critic of IBM’s management for operational reasons. It still hasn’t adapted to the new world order in the new tech world. It keeps talking the talk, but the earnings scorecards continue to disappoint.
But I still think IBM is a hot stock to own for the next decade despite my frustrations in their results. I still see an opportunity for it to shine bright for years to come. But unlike AMZN and UBER, my hope for IBM is one on what new ventures will come from them, not from what is already visible now. Meaning, this is more of a speculation than clear path. So in essence, I am giving this ancient tech giant the benefit of the doubt one more time.
For as long as I can remember, IBM has impressed the world with its feats in the world of artificial intelligence. But the topic had been left to the science world not the practical one. But these days the term AI has become mainstream, so maybe it’s time for IBM to finally shine on Main Street.
How it will monetize this is unclear, but consensus is that business will absolutely need to use AI not as a novelty feature, but one that they need to survive. Since IBM is already the face of the sector, I have to assume that they will play to be a contender, if not the dominant player much like AMZN is in the cloud today.
IBM stock, in spite of a nice earnings rally, is still more than 30% off its all-time highs. This plays in its favor, since it won’t seem bloated and ready to fall to most investors. So it is free to meander higher in the short term. But just like AMZN and UBER stock, this bet is on the next ten years, not ten days. I am eager to see how this prior behemoth can recover old glory.
It might need a new CEO to do it. I believe that Ginny Rometty has had enough chances to prove that she is the right person for the job without getting the job done. A fresh mind at the helm could be the change IBM stock needs to make the leap higher. My bet in it today is not contingent on this happening, but it would cause a spike to serve as a nice short-term booster.