I hate to pour cold water all over Dogecoin (CCC:DOGE-USD), but the thing is a joke. I mean literally, that’s why it was created. It was started as a joke in the crypto space, and once cryptocurrencies started exploding higher, everything in the group went up. That said, there are many Robinhood stocks that are far better choices.
Dogecoin has the potential to double, triple or rally even more. But that doesn’t mean it’s a high-quality asset. I’m not a crypto bear, either. In fact, there are many cryptos that I think could actually do well going forward.
However, the fact that an unlimited amount of Dogecoins can come to the market means that the supply will likely be flooded and the price will go down. Imagine if a stock had a constant supply coming into the market. It would be hard for the stock price to rally over the long term.
Switch back to Robinhood stocks and, despite the apparent insult Wall Street hurls at these traders, there are actually some very good businesses in the mix. In fact, some of the best businesses are popular on the platform.
Let’s look at eight of them:
- Apple (NASDAQ:AAPL)
- Tesla (NASDAQ:TSLA)
- Ford (NYSE:F)
- Amazon (NASDAQ:AMZN)
- Disney (NYSE:DIS)
- Twitter (NYSE:TWTR)
- Nvidia (NASDAQ:NVDA)
- Advanced Micro Devices (NASDAQ:AMD)
Robinhood Stocks Better Than Dogecoin: Apple (AAPL)
Let’s start with the biggest of them all and perhaps, the best of them all in terms of quality: Apple.
Apple sports a $2.4 trillion market capitalization, even after the stock’s latest dip. To say Apple is flying under the radar would be false and to make it seem like Robinhood stocks are of poor quality would be wrong too.
In fact, Apple is the most widely held stock on the platform.
Featuring a robust stock buyback program and steady growth, the iPhone maker has created a moat that becomes incredibly difficult to ever crack. Its products intertwine nicely and it makes is so that this ecosystem of Mac and iPhone products continues to drive Apple’s top and bottom lines.
However, the most attractive part of the business isn’t hardware, it’s services. Services sports double-digit growth and has already cleared the $50 billion mark in revenue just three-quarters of the way through Apple’s fiscal year.
Best of all though, the company’s services margins are more than double the margins the company’s hardware business generates. So not only is it moving the needle on the top line, but it’s really moving the needle on the bottom line.
Tesla CEO Elon Musk is a cryptocurrency lover. He loves Dogecoin and tweets about it often. He also likes Bitcoin (CCC:BTC-USD). Even though there’s been some back-and-forth from the company due to the environmental impact of Bitcoin mining, Tesla owns a boatload of it.
The EV maker is a high-growth company embracing futuristic technologies like autonomous driving, solar roofs and cryptocurrencies. No wonder it’s a Robinhood fave (and the second most widely held stock on the platform).
Tesla has been trading pretty well lately, even though the overall EV space has done pretty poorly. That bodes well for the stock, provided momentum eventually returns for this name.
Now profitable with a much stronger financials, Tesla is in the best position it’s ever been in. Add in analysts’ estimates for almost 60% revenue growth and for sales to eke by $50 billion this year and this one doesn’t look like it’s done.
Robinhood Stocks Better Than Dogecoin: Ford (F)
Sticking with the auto stocks, we’ve got to mention Ford. A top-five stock on the Robinhood platform, Ford has really captivated investors over the past year.
The novel coronavirus wreaked havoc on the automakers. I can’t think of any other business that has as many moving parts when it comes to supply chains and global distribution.
Automakers need time to react to major events, which can affect everything from cars on the lot to shipping to manufacturing. The pandemic has made a mess of the auto market. Then throw in the semiconductor shortage that’s still affecting the group and you get a real headache.
Migraines aside, Ford fared much better than most expected during the global pandemic. With the company’s push to go electric — and the ensuing EV craze among investors — Robinhood traders flocked to Ford stock.
Now the company is electrifying the country’s most popular vehicle, the F-150. No one doubts Ford’s commitment to EVs, which is why this stock may very well continue higher.
Amazon gave bulls a glimpse of gains earlier this year, breaking out and running to all-time highs ahead of earnings. However, the quarter didn’t do enough to impress, while the company’s guidance was surprisingly weaker than expected.
It was the first quarter without Jeff Bezos at the helm as CEO, and a lot of investors were likely expecting the company to finally split its stock. When that failed to materialize, combined with a “shoulder shrug” quarter, it’s no surprise the stock dipped.
On Sept. 2, 2020, Amazon ripped to a high of roughly $3,552, topping out with the rest of the Nasdaq. While most other FAANG and big-cap tech stocks have found their stride, Amazon has not, currently down 5% from its September 2020 high.
This company is too big to keep down forever, though. Instead, Amazon is working off some of its large gains that drove its valuation to more than $1.7 trillion. Still consolidating, it’s only a matter of time before it resumes its move higher.
That’s particularly true with analysts looking for revenue growth of 23% this year and 18% next year, with the prior two years having had growth of 38% and 20%.
Robinhood Stocks Better Than Dogecoin: Disney (DIS)
Despite volatility in its business model, there’s perhaps no company better prepared for either outcome to the pandemic.
Disney’s “stay-at-home” business is thriving due to Covid-19. It launched its Disney+ streaming platform in November 2019 and has already amassed more than 116 million subscribers. It’s raising prices on Hulu on ESPN+ too, due to demand.
This is not only riding the short-term theme of at-home entertainment, but also the secular cord-cutting growth trend. Because customers prefer these streaming options, companies like Disney and Roku (NASDAQ:ROKU) are gaining momentum like never before.
At the same time though, Disney should benefit from a return to normal. That’s by operating its theme parks, cruise ships and theatrical film releases.
Again, its business will be lumpy due to how the pandemic is handled in different parts of the world. But going forward, Disney has a great multi-pronged strategy for long-term growth.
Square (NYSE:SQ) was surprisingly not on the list of top Robinhood stocks, but Jack Dorsey’s other company is: Twitter.
That said, shares are up 21% this year and almost 50% over the past 12 months. Currently down about 17.5% from its 52-week high and bulls will be looking to drive this one higher.
After a couple of lost years due to strategy, rotating management and a failed sale of itself, the company is finally starting to pull some growth levers. It’s got several plans in place, is making small acquisitions and experimenting with different formats to boost engagement.
Analysts expect almost 37% revenue growth this year and 23% growth next year. Plus, Twitter is profitable, with the company forecast to earn over 90 cents a share this year. Estimates call for more growth next year, to $1.22 a share.
The company is really making some strides. Now let’s see if it can keep it up. At the very least, it’s a much better opportunity than Dogecoin.
Robinhood Stocks Better Than Dogecoin: Nvidia (NVDA)
One could argue that Nvidia is the most impressive sub-$1 trillion company in existence.
Not only has its growth rate been wildly impressive, but it commands strong margins and profitability. On top of that, it’s quite literally building the backbone to multiple secular growth themes in the tech world.
Datacenters, A.I. and machine learning, graphics, gaming, computing power, supercomputers, robotics, drones, autonomous driving — you name it and Nvidia likely has a hand in it.
Analysts have been wildly conservative with their estimates, which is part of what made Nvidia such a steal when it was below $200 — and that was before its recent 4-for-1 stock split!
The value may not be as good as it was 18 months ago, but it’s hard to blame those that couldn’t pull the trigger. Instead, rest easy knowing that, while there will be ups and downs, this is one of the best companies investors can buy. Period.
Advanced Micro Devices (AMD)
How can we talk about Nvidia and not talk about Advanced Micro Devices? Like Nvidia, analysts have been wildly conservative with AMD. That bodes well for the stock, which recently ripped to all-time highs.
For the current year, consensus expectations call for 61% growth. However, that growth is forecast to slow to 16% in 2022 and 14% in 2023. Will AMD really go through such a slowdown?
It’s possible, especially after such a super-charged couple of years. That said, just consider this: despite knowing how much momentum AMD had coming into 2021, analysts expected less than $10 billion in revenue for this year. That figure is now at almost $16 billion!
At the start of this year, analysts expected next year’s revenue to be around $12 billion. That figure is already north of $18 billion. In a span of just a few quarters, these estimates have exploded higher.
I can understand being too conservative during 2020, as the pandemic was wreaking havoc. But to be this conservative for this long? That makes me think the out years — like 2023 — are too conservative as well.
On the date of publication, Bret Kenwell held a long position in ROKU, NVDA and AMD. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.