As the cryptocurrency market is looking a bit too weak and is not in a position to able to bounce back strong any time soon from last year’s devastating crash, many investors are now exploring options in the stock market.
The crypto market’s downfall can be attributed to several factors, such as high inflation, rising interest rates, catastrophic failures of several high-profile crypto tokens (Terra/Luna), lenders (Celsius and BlockFi), and exchanges (FTX), as well as the ever-intensifying regulatory challenges faced by the sector.
Not all hope’s lost for the crypto market, as recent developments show that Wall Street giants such as BlackRock, Fidelity, and Franklin Templeton are in the race to list the first-ever spot Bitcoin exchange-traded funds (ETFs) in the U.S. market.
Then there is the Bitcoin (BTC) mining reward halving event coming up in Q1 2024, which according to market experts would lead to the cryptocurrency targeting an all-time high.
However, for now, we will need to step aside from the crypto market, at least until it stabilizes, and turn our focus towards tech stocks that are reliable and have high-growth potential in today’s volatile financial market.
3 Tech Stocks With Higher Expected ROI Than Any Cryptocurrency
Today I am going to introduce you to three specific tech stocks that I believe have more chances of outperforming most cryptocurrencies for the foreseeable future. This article analyzes their revenue return over the years, growth prospects, and a brief of their newly launched and upcoming products and services.
The stocks are Pinduoduo (NASDAQ: PDD), Polestar (NASDAQ: PSNY), and Trade Desk (NASDAQ: TTD).
Pinduoduo is China’s third-largest e-commerce company. With a market cap of $130 billion, market analysts expect the company to grow at a much faster rate than its rivals Alibaba (BABA) and JD.com (JD).
To put things into perspective, Pinduoduo’s revenue grew at a compound annual growth rate (CAGR) of 64% in the last three years between 2019 and 2022.
The company’s decision to implement cost-cutting measures like phasing out its lower-margin, the first-party marketplace was seen as a masterstroke by many as it helped Pinduoduo turn a profit in 2021 and nearly quadrupled its net profit the following year.
Another reason for its explosive growth is the rising popularity of discounted e-commerce marketplaces in China’s low-tier cities and rural areas, in which Pinduoduo is a pioneer.
Recently, the company announced plans to expand its online agricultural platform by onboarding more Chinese farmers. Pinduoduo even amped up investments in the country’s agricultural sector, leading to farmers adopting its e-commerce platform to directly sell their produce to customers.
Pinduoduo also announced partnerships with international brands to expand its services overseas through a cross-border marketplace called Temu.
Market analysts expect the company’s revenue and adjusted earnings to grow 50% and 29%, respectively, in 2023.
Despite its impressive growth and potential, American investors aren’t looking to invest in Chinese stocks due to rising tensions between Beijing and Washington D.C. There is also the concern that Chinese stocks like Pinduoduo may be delisted from U.S. exchanges.
But if you believe the trade dispute between the nations will be resolved, it will be a smart move to buy a few Pinduoduo stocks while anybody is barely watching.
At the time of writing, Pinduoduo (PDD) is trading at $99.07 on the Nasdaq.
There is a lot to uncover with Polestar as it is just not any other EV company that has failed to deliver on the promises made to investors. The Special Purpose Acquisition Company (SPAC) backed by Swedish automaker Volvo has shipped over tens of thousands of vehicles since its founding in 2017.
Polestar started out as a high-performance brand under the Volvo moniker but later spun off into becoming a stand-alone EV manufacturer. The company’s first vehicle, the Polestar 1, was a limited-edition sports car powered by a hybrid engine.
Polestar 1 was discontinued earlier this year and currently, the company is only selling its second model, the Polestar 2 electric sedan.
In 2021, Polestar sold a total of 28,677 vehicles, and this figure almost doubled the next year with 51,491 vehicles sold through various dealerships worldwide. Polestar 3, which is the car manufacturer’s upcoming electric SUV, will be shipped out in the first quarter of 2024.
However, macroeconomic conditions are not helping the $7.8 billion valued company as it is faced with widening losses caused due to rising operational and manufacturing costs worldwide.
Despite the circumstances, market experts expect Polestar to improve its sales by 23% this year and make at least $3.04 billion in revenue, largely thanks to increased global demand for electrical vehicles and the implementation of climate-related economic and environmental policies.
At the time of writing, Polestar (PSNY) is trading at $2.74 on the Nasdaq.
Trade Desk is said to be the world’s largest independent demand-side platform (DSP) for digital ads that enables advertisers to place bids for ad spaces across mobile, desktop, and connected TV platforms. Generally, DSPs work together with supply-side platforms (SSPs), helping publishers sell their own ad inventories.
In the case of Alphabet’s Google and Meta Platforms (formerly Facebook), they combine DSP, SSP, and other marketing tools when offering their services but tend to restrict advertisers by only allowing them to market their products through Google and Meta-supported platforms or ecosystems.
Due to this, advertisers that want to sell their ads on the open internet often work with independent DSPs like The Trade Desk.
Revenue growth performance indicates that there is increased demand for Trade Desk’s goods and services. Between 2016 and 2022, the company’s annual revenue grew by 41%, while its adjusted revenues before interest, taxes, depreciation, and amortization (EBITDA) rose by 47%.
A lot of this increase can be attributed to the recent growth in connected TV platforms shifting towards streaming services that support independent ads.
Recently, the Trade Desk announced plans to expand its ad ecosystem by launching a new platform called Solimar, which uses AI algorithms to source publicly available data for targeted ads.
Solimar’s Unified ID 2.0 format fully eliminates the need for third-party cookies, while its OpenPath technology helps bypass SSPs by directly connecting advertisers to publishers.
Market analysts expect the company’s revenue and adjusted EBITDA to rise by 23% and 15%, respectively, by the end of the year.
At the time of writing, The Trade Desk (TTD) is trading at $85.37 on the Nasdaq exchange.