robin hood (hood -1.87%) Investors have a reputation for buying memetic stocks and cryptocurrencies, perhaps because they are looking for short-term gains rather than long-term returns. The average Robinhood account was worth just $2,803 in the brokerage’s latest quarter. Some investors may think that there is not enough cash for serious investment.
But it’s simply not true. With $3,000, you would be better off buying stocks in the cloud, cybersecurity and chip manufacturing sectors that could explode in the coming decades, rather than jumping straight into speculative investments. would be wise without Below are three solid tech stocks you can buy and hold for the long term. Twilio (TWLO -0.95%), Palo Alto Networks (PANW -1.09%)When wolf speed (wolf -1.77%).
1. Cloudplay: Twilio
Twilio’s cloud-based platform handles integrated text messaging, voice calls, and other communication functions for mobile apps. Building these features from scratch can be time-consuming, buggy, and difficult to scale, but with a few lines of code, a developer can outsource these services to his Twilio usage-based platform. Now
Many people may not be familiar with the Twilio brand, but Twilio is behind many popular apps. for example, Airbnbsof guests contacted hosts and liftpassengers contact the driver. It also provides text his message notifications. door dash Customers regarding orders.
Although Twilio’s growth has slowed since its public debut, we expect organic revenue to grow at an average annual rate of about 30% through 2024. That’s pretty good growth for a stock trading at just three times its sales this year.
Twilio is still seriously unprofitable, so it trades at a discount to many of its cloud-based peers. The company’s gross margins are also being squeezed by higher carrier fees and a combination of low-margin international revenue in recent quarters. But despite these challenges, Twilio is able to reverse that decline in the long term, expanding non-GAAP gross margins from the low 50s to over 60%. I think.
If Twilio maintains targeted revenue growth while stabilizing gross margins, the tattered stock price, which has plunged more than 80% over the past 12 months, could make a stunning comeback.
2. Cybersecurity Strategy: Palo Alto Networks
Palo Alto Networks initially attracted attention as a supplier of next-generation firewall appliances. But in the last few years, it has expanded beyond the saturated on-site appliance market by investing heavily in cloud-based security services and AI-powered threat detection tools. Today, Palo Alto derives most of its growth from these NGS (Next Generation Security) services.
Palo Alto’s balanced mix of legacy and next-generation cybersecurity services can consistently generate double-digit billing and revenue growth. We expect 20% to 21% billing growth and 25% revenue growth to continue in fiscal 2023, which began in early August.
Palo Alto’s scale has also enabled it to remain profitable on a non-GAAP basis. We expect his non-GAAP earnings per share (EPS) to increase another 24% to 26% in fiscal 2023, with GAAP EPS eventually turning positive for the full year.
Palo Alto isn’t cheap at 59 times its expected earnings and 8 times its sales this year, but it’s a very reasonable value compared to its industry peers.For example, Palo Alto’s cloud-native rival cloud strike (CRWD -0.30%) Although growing much faster, it is still unprofitable by GAAP measures, trading at 18 times its sales this year. Therefore, investors looking for a cybersecurity strategy that offers an attractive combination of growth and value should get their hands on Palo Alto stock today.
3. Chipplay: Wolfspeed
Chipmaker Wolfspeed, formerly known as Cree, is a leading manufacturer of wide bandgap (WBG) semiconductors made from silicon carbide and gallium nitride materials. WBG chips can operate at higher voltages, temperatures and frequencies than traditional silicon chips, making them ideal for short LEDs, lasers, 5G base stations and military radars. Many electric vehicle manufacturers are also starting to use silicon carbide to make their batteries and powertrains.
Wolfspeed believes the long-term transition to more energy-efficient silicon carbide chips across multiple industries will drive long-term growth, and recently acquired the world’s largest 200 mm silicon carbide chip to support these plans. We opened a factory. Wolfspeed makes all of its chips in the United States, so it could also benefit from the recent passage of the CHIPS and Science Act, which provides substantial subsidies and tax breaks for domestic chip makers.
Wolfspeed’s revenue increased 42% to $746 million in fiscal year 2022, which ended in June. This is due to the opening of his new 200mm fab and increased chip sales to the automotive, industrial and energy markets. Its net loss also narrowed significantly in both GAAP and non-GAAP measures.
Analysts expect revenue to continue growing by more than 40% annually. both In 2023 and 2024, market demand for WBG chips is still heating up, while the broader semiconductor market is cooling. The company’s stock certainly isn’t cheap, at 13 times his sales this year, but its long-term growth potential could easily justify its premium valuation.
Leo Sun has held positions at CrowdStrike Holdings, Inc. and Palo Alto Networks. The Motley Fool has positions in and endorses Airbnb, Inc., CrowdStrike Holdings, Inc., DoorDash, Inc., Palo Alto Networks, Twilio, and Wolfspeed, Inc. Motley Fool has a disclosure policy.