You must have read several articles about how $10,000 invested in a stock in the early 2000s is worth a $100,000 today. If only you could go back in time and invest in that stock, you could be sitting on a pile of money. The stock market is about learning from the past and investing in future growth because that is where your next $100,000 are.
How to make money work for you
At the start of the 21st century, there was a craze for mortgage companies, which created too-big-to-fail banks. Anyone who got their hands on bank stocks minted money. The mortgage bubble burst after the 2008 subprime crisis. After that, investors saw the rise of tech stocks, creating trillion-dollar tech giants. Trends will come and trends will go. Investing early in these trends will grow your money.
The next big trend is artificial intelligence (AI), and it is getting smarter. It is time to upgrade your knowledge and outsmart AI before ChatGPT takes your job. While you upgrade your knowledge, also upgrade your investments. The AI bubble has got investors excited about tech again.
Got $1,000: Buy two high-growth stocks right now
The upcoming tech trends are AI, autonomous cars, 5G, and maybe crypto. These trends will create opportunities in alternative segments, which some investors missed seeing in the AI frenzy. If you have $1,000, buy these stocks before they catch up to the trend.
BlackBerry (TSX:BB) stock jumped over 12% as its first-quarter earnings beat estimate and shocked investors with upbeat cybersecurity revenue. The company is a leader in cybersecurity and Internet of Thing (IoT) convergence, which, according to McKinsey is estimated to be a $750 billion market by 2030. It is just the beginning of the cybersecurity growth opportunity.
The self-thinking and self-learning AI could be misused by hackers. And with 5G, the proliferation of IoT devices will make it even more important to keep your cloud-connected devices from being hacked. Check Point’s report showed that average weekly cyberattacks worldwide increased 7% to 1,248 attacks in the first quarter (Q1) of 2023.
The more powerful AI becomes, the stronger the need to keep it under check. While ChatGPT is stealing jobs in some areas, it is growing jobs in the cybersecurity space. The industry is seeing a significant staff shortage given the increasing number of attacks. BlackBerry has launched an AI-based Cyclane cybersecurity solution to enhance cloud defence coverage. The company expects its cybersecurity revenue to increase at a compound annual growth rate (CAGR) of 12% by fiscal 2026.
BlackBerry also has its pent-up automotive QNX royalty revenue delayed due to auto industry headwinds. Once the headwinds subside, it will realize this revenue, driving the stock to a new high.
The payments platform company Nuvei’s (TSX:NVEI) stock has fallen over 30% since May and is trading below its initial public offering price. But you now see momentum returning in this stock. The stock fell as Nuvei increased its exposure to the United States by acquiring the U.S.-based integrated software and payments platform Paya. The price dip was an overreaction as the acquisition created a one-off loss for Nuvei. But as I said before, you invest in future growth prospects without panicking about the present.
Paya has opened a whole new opportunity of Enterprise Resource Planning (ERP) for Nuvei, which depends on e-commerce transactions for its revenue. Nuvei is signing up corporate clients like Radisson Hotel Group and Virgin Atlantic, which have global operations and high transaction volumes. And their volumes are not volatile as that of e-commerce. Nuvei is now moving from cyclicality to a stable source of recurring revenue — a plus point for a tech stock that makes profits. Most tech stocks are sitting on huge losses.
And let us not forget Nuvei’s exposure to crypto. The platform facilitates its customers to accept and pay in cryptocurrency for a small commission. Another crypto bubble could drive Nuvei’s stock on the sidelines because of huge volumes of crypto transactions.