Gaming companies are looking like a coronavirus-proof investment. Here are the stocks to play, top fund managers say – MarketWatch
Posted: May 1, 2020 at 7:48 pm
People around the world are turning to fan-favorite games like Assassins Creed and Prince of Persia to pass the time during lockdown, firmly placing gaming companies in the buy column for some of the worlds most well-known fund managers.
Investment trust managers in the U.K. are tipping the industry as coronavirus-proof, as video games easily continue sales in this new reality that has negatively impacted other forms of entertainment, such as cinema and theater.
The total U.K. video games market, including buying software, consoles and online gaming, hit 5.35bn last year, according to figures published last week by the Association for U.K. Interactive Entertainment.
In the U.S., spending on video games in March rose 35% year-on-year to $1.6bn, while all video game categories experienced double-digit sales increases over the month, according to market research company The NPD Group.
NPD, which tracks U.S. consumer spending on video games, said last week that Animal Crossing - Nintendos latest release for its Switch console had taken the top spot as the best-selling title in March, beating 2019s most popular game, Activision Blizzards ATVI, +1.55% Call of Duty: Modern Warfare.
Investment trust managers have argued that the gaming industry still has significant room to grow and with many of the stocks viewed as undervalued, they are seizing the opportunity to invest.
Speaking to trade body, The Association of Investment Companies, here is what they said:
Walter Price, Portfolio Manager of Allianz Technology: We think this is an undervalued part of technology and we like all the stocks to varying degrees. The event of Covid-19 has emphasised to some very powerful tech companies the value of diversified revenue streams and we think the game companies are undervalued relative to their diversification value.
Paul Johnson, Gaming Analyst for Polar Capital Technology Trust: We hold a position in Microsoft MSFT, -2.58% as well as several video game publishers which stand to benefit. We believe that higher engagement will translate into higher monetization and the early signs are promising if third-party transaction data aggregators are to be believed. Given shelter-in-place orders, we also anticipate an inflection in digital downloads which have better economics for Microsoft and the publishers than physical sales.
Harry Nimmo, Manager of Standard Life UK Smaller Companies Trust: There are now a good handful of video game-exposed companies listed in the U.K., but we believe Team17 TM17, -2.99% is one of the lower-risk models. They are a developer, but focused on lower-budget indie games, and work with a lot of third-party developers where they have a revenue share model. This means that there is very low capital at risk from the success or not of a particular game, with game budgets typically under 1 million. Team17s revenue stream is very diversified, and there is still significant revenue driven by back catalogue titles they were the creators of Worms for example where they continue to innovate on successful brands.
Alexander Windsor-Clive, Analyst for Lindsell Train Investment Trust: We believe that Nintendo NTDOY, +1.78% will continue to flourish in the long term, driven both by trends in the industry and the enduring resonance of its ubiquitous intellectual property, which has entertained quite literally hundreds of millions of people across the world over a multi-decade period. Companies like Nintendo with dominant intellectual property are best placed to capitalise on the digital shift and future innovations in the sector. Developments in cloud gaming, virtual reality, augmented reality and esports are still nascent but have the potential to fundamentally reshape the industry.
Joe Bauernfreund, Investment Manager of AVI Global: We view Sonys gaming segment as one of the four crown jewels of the empire, with the other three being semiconductors, music, and pictures. The heart of our investment thesis for Sony SNE, -2.36% is that the complex conglomerate structure serves to mask the value of the separate underlying businesses, each of which are highly attractive in their own right.
Greg Herr, Co-Portfolio Manager of Alliance Trust: With new markets opening up across the world, and the proliferation of mobile devices, we believe the scope for expansion within the video gaming sector is substantial. In the current environment, with millions of people across the globe confined to their homes in the battle against COVID-19, the scope for increasing use of video gaming is huge.
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Gaming companies are looking like a coronavirus-proof investment. Here are the stocks to play, top fund managers say - MarketWatch
Free databases offer movies, math, investing and more through Jefferson Library – NOLA.com
Posted: at 7:48 pm
A variety of databases are offering free access through the Jefferson Parish Library during the pandemic.
KANOPY: A database of movies, documentaries and other video content, is offering an array of titles free to libraries until May 31. Library patrons may enjoy a special collection of titles, as well as all of Kanopy Kids, with no play credits deducted. Kanopy can be accessed under the digital content tab on the JPL website.
Kanopy also is offering free and unlimited access to the Infectious Diseases collection from The Great Courses. Throughout these 24 free video lectures, Dr. Barry Fox delivers clear and up-to-date information on dozens of infectious diseases from where they originate, to how they spread, to how we can overcome their devastating effects.
Patrons can arm themselves with scientific facts about bacterial infections, viruses, vaccines and more in this engaging course by an award-winning professor and physician. This offering is available now through May 31.
MORNINGSTAR: Many investors are turning to Morningstar Investment Research Center to stay updated about what is going on with the stock market. Patrons can access Morningstars daily coverage under the Articles & Video tab on the database.
Morningstar also offers a free financial education webinar: Navigating Investing During Novel Coronavirus: Investor Education & Guidance with Karen Wallace, director of investor education at Morningstar, and Joe Saari, head of product at Financial Fitness Group, in a webinar on financial education.
They say, When the markets are diving, and our health is at risk, fear can take over. To stay calm and focused on the long-term, were going back to basics and stressing strong financial education and fitness.
Other suggestions (patrons need to be logged into the database to access):
FOR THE KIDS: TumbleBooks, a provider of online childrens book databases, announced that it is making its family of online libraries available for free to the Jefferson Parish Library until at least Aug. 31.
Its flagship product, TumbleBook Library, is a collection of animated talking picture books, read-alongs, e-books, quizzes, lesson plans and educational games used by thousands of schools and public libraries in more than 100 countries.
The collection includes TumbleBookLibrary K-5; TumbleMath K-5; TeenBookCloud 5-12; AudioBookCloud teen/adult and RomanceBookCloud adult.
TumbleBooks can be accessed by patrons from their homes. The sites are easy to use, and access is unlimited. They can all be accessed on the Databases tab of the JPL website.
TUTORING: Tutor.com has expanded its live tutoring hours to provide additional support for students in communities impacted by COVID-19.
The new one-to-one live tutoring hours are 8 a.m. to midnight Monday through Friday. Saturday and Sunday live tutoring hours will continue at 2 p.m. to midnight as usual. These expanded hours will continue until May 31.
The Tutor.com/HomeworkLA landing page is http://www.homeworkla.org/.
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Free databases offer movies, math, investing and more through Jefferson Library - NOLA.com
Why I’m investing in real estate to fund my retirement – Business Insider
Posted: at 7:48 pm
Personal Finance Insider writes about products, strategies, and tips to help you make smart decisions with your money. We may receive a small commission from our partners, but our reporting and recommendations are always independent and objective.
Everyone has a unique idea of what their ideal retirement should look like. I'm looking forward to a time when work is optional and I have a reliable cash flow coming from several sources. One important income source I plan to have for the future is real estate.
I've come across many wealthy and successful people in my life, and one place that I've seen success time and again is in real estate. I've known people who were secret real estate millionaires with a portfolio of rental houses and apartments.
Based on everything I've learned from them and my own experiences in real estate, here's my long-term plan for adding real estate to my retirement.
Many people start investing for the first time with a 401(k) plan or similar employer-sponsored retirement account at work. Employer and other investment accounts give you access to a wide range of stocks, ETFs, mutual funds, bonds, and other investments.
Because most people don't start out with enough cash to buy a multi-unit building but can afford to buy a stock or fund, REITs, real estate investment trusts, are a way to invest in real estate without buying the whole thing.
REITs are companies that manage real estate and are required to pay out a certain portion of profits as dividends. That makes them ideal for generating cash flow for retirement. Popular REITs include property management, self-storage, retirement homes, golf courses, and other real estate.
Simon Property Group and Public Storage are among the largest and most recognizable REITs. You can also buy REIT mutual funds and ETFs through fund managers like Vanguard, Schwab, Fidelity, BlackRock, State Street, and others. If you already have a brokerage account, you can quickly and easily buy an REIT today.
I have REITs in both my retirement and taxable investment accounts and plan to add more as my retirement accounts grow in the future.
Just last month, I took the next step in my real estate investment journey with Fundrise. I opened an account with a $1,000 starting investment to test the waters. While REIT investing is a great way to get exposure to a very diverse set of properties, they can feel very removed from the properties. Fundrise brings me one step closer.
Fundrise and other real estate financial technology companies allow you to invest in smaller real estate funds with more direct exposure to the end properties. For example, Simon Property Group owns more than 200 properties. Public Storage operates more than 2,000 locations. My investment at Fundrise went to about 25 properties owned by four different Fundrise funds, called eREITs.
I can log into my account and view details about each property including the location, type of investment, and projected return. While Fundrise takes out a management fee, average recent returns for the last six years have ranged from around 9% to 12%.
Assuming all goes well with my first $1,000, I plan to add more in the future. Funds here are focused on income, growth, balanced, or region-centric investments. You can start with $500. Fees are 1% per year.
To me, the Holy Grail of real estate investing is passive, buy-and-hold properties. Most people I've met with serious wealth own a portfolio of rental houses, apartments, condos, and even commercial properties. I'm personally most interested in residential multi-unit real estate.
But while I can buy shares of a REIT for under $100 and start with Fundrise at $500, it takes a lot more to get going with your own investment properties. However, if you have enough cash to buy individual properties and they are managed well, real estate can provide a predictable income stream that supports your family's needs. And, unlike a job, you don't have to show up every day to get paid.
My wife and I are saving up a down payment for our first rental property. Because these take tens of thousands of dollars to start, if not more, it may be awhile before we pull the trigger for the first time. But it's certainly a part of my retirement strategy.
In retirement, I'm looking forward to income from Social Security, my retirement fund investments, and real estate. But while Social Security has limited potential, there's no cap on what I can make from real estate and other investments.
If you play your cards right, you can even retire early with real estate. Because most people invest in real estate outside of their retirement accounts, they can start earning income from those properties right away.
For now, I'm in saving, investing, and building mode for my real estate portfolio. But it's a big part of my long-term retirement plans.
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Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.
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Why I'm investing in real estate to fund my retirement - Business Insider
Data reveals massive nationwide investment in health infrastructure by Akufo-Addo – GhanaWeb
Posted: at 7:48 pm
General News of Friday, 1 May 2020
Source: http://www.ghanaweb.com
Health minister, Kwaku Agyeman-Manu
Data intercepted by ghanaweb.com has revealed the government of Nana Akufo-Addo has invested more in health infrastructure across the country than it has been given credit for.
In the last couple of days, the president has been accused of now realising the importance of investing in health infrastructure after he announced plans to construct 88 hospitals in the districts without hospitals as legacy projects of the coronavirus.
However, from the data sighted (inserted in story), it appears some investment had already been done in the health sector.
Data obtained by ghanaweb shows the government's massive health infrastructure investments, numbering 654 projects, are located across all sixteen regions of the country in various districts.
The 654 projects, mainly construction of new health facilities and chip compounds, expansion and rehabilitation of existing facilities, provision of modern health equipment, etc., are concentrated in deprived communities to improve access to healthcare.
Regional distribution of completed projects
Out of the 654 health infrastructure projects, 339 have been completed and they are spread across all sixteen regions of the country.
The Ahafo Region has 12 projects completed, Ashanti Region has 46 projects, Bono Region 28 projects , Bono East 9 projects, Central Region 34 and Eastern Region has 41 projects completed.
Others are: Greater Accra 14, North East Region 6, Northern Region 39, Oti Region 11 and Savanna Region 20.
The rest are: Upper East, 19, Upper West 35, Volta Region 19, Western Region 5 and Western North Region 8 projects completed.
Regional distribution of on-going projects
The remaining projects out of the 654 are ongoing projects which are also spread throughout the sixteen regions as follows:
Ahafo Region 6, Ashanti Region 47, Bono Region 25, Bono East Region 8, Central Region 23 and Eastern Region 45 projects.
Others are: Greater Accra 12, North East Region 5, Northern Region 49, Oti Region 5 and Savannah Region 13.
The rest are: Upper East Region 17, Upper West Region 16, Volta Region 13, Western Region 23 and Western North Region 15.
Inherited projects
The document also revealed that contrary to claims, the Akufo-Addo government has also invested in about 30 health projects it inherited from the previous government in 2017.
About 16 of such projects in the Central, Greater Accra, Upper West and Northern Regions have been completed.
While 11 of such projects are on-going, three of the projects have been re-awarded to a contractor.
Meanwhile, the document, which Health Minister Kweku Agyemang Manu read aspects of it during his press conference earlier in the week, also captures the massive investment the government has made in procuring 320 ambulances nationwide.
Below is the full list of the 649 health projects and their locations, as well as the 30 inherited projects.
Send your news stories to and via WhatsApp on +233 55 2699 625.
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Data reveals massive nationwide investment in health infrastructure by Akufo-Addo - GhanaWeb
Private equity backer of EnerMech and Neptune Energy posts investment loss of nearly 1bn – News for the Oil and Gas Sector – Energy Voice
Posted: at 7:48 pm
The private equity backer of Aberdeen-headquartered Enermech and operator Neptune Energy posted an investment loss of nearly 1billion for the start of the year.
Carlyle Group cited the fallout from the Covid-19 pandemic for the 957m deficit in the first quarter, which compares to a 520m profit in the same period a year ago.
The US corporation has now wiped out all financial guidance given at the start of the year, stating the crisis reduces its ability to accurately forecast near term financial results.
Carlyle commands assets worth $217bn (173.2bn) under management via nearly 400 investment vehicles.
It bought energy services firm EnerMech in 2018 from Lime Rock Partners in 2018 in a 450m deal.
The firm also holds a 30% stake in Neptune Energy, which employs around 140 people in Aberdeen and operates the UKs largest gas field, Cygnus.
Carlyles real assets segment decreased in value by 14% to 31.7bn during the period, mainly driven by write-downs in the energy portfolio, it said.
Meanwhile, co-chief executives Kewsong Lee and Glenn Youngkin praised courageous frontline workers.
They added: Since the beginning, our priority has been the health and safety of our people. As a firm, we have adapted well to this new environment as we support our companies and prepare for a wide range of outcomes.
The momentum weve established and our strong first quarter give Carlyle a position of strength as we navigate the current environment.
We are taking a balanced and patient approach, and our global and diversified platform enables us to provide capital to companies as long-term investors as we drive value for all of our stakeholders.
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Private equity backer of EnerMech and Neptune Energy posts investment loss of nearly 1bn - News for the Oil and Gas Sector - Energy Voice
Oil ETF overseer addresses the risks of investing in crude-based funds – News Info Park
Posted: at 7:47 pm
ETFs have found themselves at the epicenter of the crude oil collapse.
One exchange-traded fund in particular the United States Oil Fund has been under extensive pressure in the wake of last weeks collapseoil price futures.
The unprecedented move into negative territory forced the USO to restructure several times by dumping shorter-term futures contracts to avoid imploding on its many retail investors. It has also made the fund a target of short sellers betting against its survival.
All this has made some in the industry question whether more education or warning should be required from companies offering ETF products that trade futures contracts.
The key is transparency, said Jason Bloom, who oversees the Invesco Oil Fund (DBO), USOs top rival fund.
While both USO and DBO have fallen precipitously this year, DBO has held up relative to its peer, with a 51% loss versus USOs 83% decline.
USO and DBO are similar in that theyre both ETFs and they both hold WTI futures contracts, but thats about where it ends, Bloom said Monday onCNBCs ETF Edge.
DBO since its inception over 10 years ago has always used an optimization process in selecting which futures contract to own, said Bloom,Invescos director of global macro ETF strategy.Occasionally, they own the front part of the curve, which USO used to own exclusively until the several changes recently.
That optimization process involves a cost-effectiveness calculation on DBOs part. Before its futures contracts roll over, the fund determines which futures contract has the best cost of carry, Bloom said.
Related News: No, oil below $0 doesn't mean the gas station will pay you to fill up
In some cases, its actually positive income if the futures markets are backward-dated, which happens when the current price rises above the price of longer-dated futures, he said.
Right now, the opposite is happening with oil prices theyre in contango, which means longer-dated futures prices are higher than the spot price of crude.
Contango means that theres a negative cost, theres a cost burden on the investor, to hold that futures exposure over time, Bloom said. DBO seeks to minimize that cost in a contango market. We currently hold the March 2021 futures contract, which is pretty far out the curve, and it hasnt really been subject to some of these issues weve seen in the front of the curve.
Heres where the transparency comes in. DBO shareholders know that the ETF will hold that March 2021 contract until about three weeks before it expires, then make that optimization calculation and roll it over, Bloom said.
So, you have a great deal of transparency as to what your exposures going to be in DBO, and then you can do the math, he said. If you buy DBO today and that futures contract is $29 a barrel, you know that if youre above $29 a barrel minus management fees, you have a chance to profit from that. So, it just depends on your expectations and your time frame.
We think its the best balance between predictability, transparency and having some sort of dynamic optimization, Bloom said of DBO.
Tom Lydon, CEO of ETF Trends and ETF Database, agreed that investors need to be aware of what they own when they buy shares of commodity ETFs.
Related News: Report: Google Slows Hiring For Rest Of 2020 While Bracing For Downturn
I think a lot of investors were thinking that in buying USO, they may be able to profit from future oil prices when people start driving cars and flying in planes again, but what in fact they bought were people not filling up their tank and a bunch of tankers full of oil sitting off the coast, he said in the same ETF Edge interview. And it didnt translate to them. So, youve got to look under the hood.
Todd Rosenbluth, senior director of ETF and mutual fund research at CFRA, echoed that point in the same interview.
These kinds of products that use futures are more dangerous for investors, Rosenbluth said. It makes it harder for them to understand what theyre actually owning.
Rosenbluth pointed out that although USO is slightly cheaper to own than DBO, with an expense ratio of 73 basis points versus DBOs 78, its underperformance has been notable. Over the past three years, USO has fallen 79% versus DBOs 39% decline.
So, you really need to understand whats inside the portfolio, how these are different and then determine if these are even appropriate for you and your clients, Rosenbluth said.
USO, the markets largest oil ETF by net assets, fell nearly 3% in Tuesdays session. DBO ended the day slightly lower.
Disclosure: Invesco is the sponsor of CNBCs ETF Edge.
Disclaimer
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Oil ETF overseer addresses the risks of investing in crude-based funds - News Info Park
These money and investing tips offer a common sense response to the coronavirus crisis – MarketWatch
Posted: at 7:47 pm
Dont miss these top money and investing features:
These money and investing stories, popular with MarketWatch readers this past week, offer ways to manage your financial portfolio and to invest strategically during the coronavirus pandemic and afterwards.
The U.S. stock market is itself a forward-looking instrument. This is the one leading economic indicator stock investors should follow
Value Line survey sees 8% annualized returns between now and April 2024, writes Mark Hulbert. This respected market-timing model just flashed a bullish four-year outlook for stocks
Value strategy continues to lag in a market where earnings growth is scarce, writes Mark Hulbert. These beaten-down stocks should be big gainers, but investors arent in a bargain-hunting mood
Taking another look at Fixed Index Annuities How to turn the S&P 500 into a bond
Ohio Rep. Ryan: Emergency Money for the People Act covers what the CARES Act missed. One $1,200 stimulus check wont cut it. Give Americans $2,000 a month tax-free to fire up the economy
Insolvent pension plans could drag some cities into bankruptcy Coronavirus will make Americas cities feel the pressure of pension debt
Expand the purchase of Main Street loans; limit the purchase of government loans. The Fed should not be bailing out the underfunded pensions of cities and states
A new offering from Fidelity Investments inhabits a gray areas amid the market shift, and suggests that theres more life left in the mutual fund space than ETF-watchers might realize. A loyalty program for mutual funds? Fidelity tries something new
ETF industry veterans expect to see mutual funds convert their structure to what they consider a superior wrapper for asset management. Will mutual funds get a second wind... as ETFs?
Tal Cohen, head of North American markets at the Nasdaq, discusses the resiliency of major tech companies amid a volatile earnings season. Nasdaq says tech companies will soar this earnings season
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These money and investing tips offer a common sense response to the coronavirus crisis - MarketWatch
Should You Invest New Money During the Coronavirus Pandemic? – The Motley Fool
Posted: at 7:47 pm
Efforts to blunt the impact of the coronavirus pandemic have led to some of the most abrupt negative economic changes in modern history. First-time unemployment claims hit record highs as businesses shuttered or were otherwise restricted to reduce gatherings of people. Oil traded at negative prices as demand dried up and suppliers started running short of places to store the stuff.
Overall, The Wall Street Journal estimates that more than a quarter of the U.S. economy has been taken offline by efforts to fight the spread of that illness. There's reason to believe the economic fallout will get worse the longer restrictions stay in place. With all that going on around us, investing may very well be the last thing on your mind. Indeed, the easy answer to the question of whether you should invest new money during the coronavirus pandemic is a resounding "No!"
Unless....
Image source: Getty Images.
If you have a solid financial foundation in place, now may very well be a great time to invest in companies that look likely to survive this crisis and emerge stronger on the other side of it. You need to have that foundation in place because if you lose your job in the next round of layoffs, you don''t want to rely on selling those stocks to help you cover your immediate costs. Being forced to sell because you need the money is a recipe for losing money in a down market.
A strong financial foundation has the following three key factors:
Image source: Getty Images.
As long as that foundation is in place, you can consider investing new money during the coronavirus pandemic. What you must remember, though, is that you should only invest money in stocks that you don't think you'll need for at least the next five years. You can use that long term focus in two key ways to help you invest smarter.
First, as the past couple of months remind us, the stock market can be incredibly volatile. A long-term focus will help you better stomach that volatility by helping you put distance between what's happening to your investments and what you need to cover your day to day life. It's incredibly hard to stay invested in rough times as it is, but if you're relying on that money to cover your rent, it's downright impossible.
Second, over the long haul, a company's strength and growth prospects matter far more to its stock's success than the market's day-to-day movements. A long term time frame helps you focus on those business fundamentals of the companies you're considering investing in. That can help you both make better buying decisions and see whether price declines during a market panic really represent an opportunity to buy more shares at a bargain price.
Image source: Getty Images.
If you have both a solid financial foundation in place and the long-term focus it takes to invest successfully, you may want to put your money to work in the stock market during thiscoronavirus pandemic. No matter how great the market's bargains may be, however, they'll only do you any good if you're able to hold on to those investments until better days return.
As the old saying goes, fortunes aren't made in bull markets -- that's just where they get revealed. That makes now a great time to get your solid financial foundation in place and develop the long term focus that you need. With those two factors in place, investing now may very well improve your chances of having your own fortune revealed in the next bull market.
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Should You Invest New Money During the Coronavirus Pandemic? - The Motley Fool
Guest view: Invest in Butte by voting "yes on Economic Development Mill continuation – Montana Standard
Posted: at 7:47 pm
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Joe Willauer is the executive director of the Butte Local Development Corp.
On our primary-election ballot is an initiative to support the continuation of a program that has supported many of the businesses and events that many us care for in our community.
The Economic Development Mill is a 1-mill levy to support growth, activity, and development throughout our local economy and has delivered countless dollars of investment and jobs.
The mill was originally established in 1990 with the intent of supporting Economic Development Purposes For A Five Year Period and has been renewed ever since. Originally the fund directly supported organizations like ours, the Butte Local Development Corporation (BLDC), and has since transitioned into a grant fund to provide critical funding for festivals, businesses, job growth, and economic activity within Butte.
Through the utilization of the mill and the investments that have been made, there have been numerous positive ripple effects in many economic sectors including supporting the growth of small businesses, recruitment efforts to bring new businesses to town, support for our beloved festivals as well as the many sporting events that pack the civic center. These funds circulate throughout our community delivering additional impacts in many sectors.
Currently, the program is administered through a competitive grant process that businesses, organizations, and individuals can apply for if they believe that their plan will lead to economic growth and activity.
If You’ve Got $3,000 to Invest, Buy These 3 Top Stocks Right Now – Motley Fool
Posted: at 7:47 pm
It's been more than two months since the start of the bear market that ravaged good and bad stocks alike, yet in recent weeks, the bulls have been running again as investors begin to believe that things will eventually return to normal in the wake of the coronavirus pandemic.
Numerous overarching trends that began long before the pandemic have found the spotlight in the face of the stay-at-home orders, giving the industry leaders an edge and even accelerating these already emerging or dominant shifts in technology and consumer behavior. This gives investors an opportunity to tap into these changes and even profit from them.
Assuming you have an emergency fund to fall back on and $3,000 (or less) that you don't need for three to five years, here are three companies riding powerful trends that will help them flourish for years to come.
Use of digital payments is exploding. Image source: PayPal.
Even before the outbreak, PayPal (NASDAQ:PYPL) was the undisputed leader in digital payments, and as sheltering at home became the new normal, the company has experienced what CEO Dan Schulman called "a tremendous increase in the use of digital payments."
In the past few weeks alone, the number of new customers has exploded, and Schulman said users signing into Venmo or PayPal have jumped dramatically, "in some cases doubling." He cited increases across a wide range of shopping verticals, including groceries, electronics, homewares, and gardening. Schulman also said, "Gaming is exploding."
PayPal was already generating strong growth before the surge. Revenue grew 15% in 2019, while profits increased by 28%. The company added more than 37 million new accounts last year, bringing the total to 305 million, while payment transactions per active account climbed 10%. PayPal also processed more than 12 billion payment transactions worth $712 billion in total payment volume (TPV) in 2019, with more than $100 billion of that attributable to Venmo.
The shift toward digital payments is ongoing and has gotten a sizable boost from consumers on lockdown -- and PayPal stands to benefit the most from the trend.
Video games are seeing a surge during stay-at-home orders. Image source: Getty Images.
The increasing popularity of video games over the past decade is well documented, though, in recent years, investors feared free-to-play and battle-royale games would siphon off revenue from the major players (pun intended).
Activision Blizzard (NASDAQ:ATVI) is one of the leaders in the space and delivered better-than-expected results last year, even in the face of record comps in 2018.
Since the onset of the pandemic, however, video game sales around the world have seen a resurgence. Spending on digital titles climbed 11% year over year, reaching a record $10 billion in March -- the highest monthly total ever, according to Nielsen-owned SuperData. Premium console revenue rocketed even higher, up 64% between February and March, while premium PC revenue jumped 56%.
Activision Blizzard is well-positioned to benefit as consumers sheltering at home seek refuge in their favorite video games, with many of the company's fan-favorite titles represented in the top 10, including World of Warcraft, Call of Duty: Modern Warfare, and even free-to-play titles like Candy Crush. The company also released Call of Duty: Warzone -- the answer to its free-to-play and battle-royale rivals -- which attracted more than 50 million players within one month after its March 10 launch. This illustrates the wisdom behind the old cliche, "If you can't beat 'em, join 'em."
That's not all. CEO Bobby Kotick said, "Most of our games are seeing record levels of engagement ... [and] a lot of new players are coming for the first time."
Video games were already a popular pastime, and shelter-in-place orders are providing more fuel for the fire.
Videoconferencing has become a remote-work staple. Image source: Zoom Video Communications.
Videoconferencing was already experiencing increasing adoption before the need for remote work changed it from convenience to necessity. No company is better positioned to benefit from this shift than Zoom Video Communications (NASDAQ:ZM).
The transition to remote meetings was already well underway before the COVID-19 pandemic struck, as evidenced by Zoom's blockbuster results over the past year. Revenue grew 88% in 2019, and the company generated a profit for the first time, which is unusual for a newly minted company; Zoom only went public this time last year.
Customer metrics were even more impressive, as Zoom ended the year with 81,900 customers, up 61% year over year, while those spending more than $100,000 over the trailing-12-month period grew 86%. Once onboard, customers tend to spend more, as illustrated by the company's net dollar expansion rate, which topped 130% for the seventh consecutive quarter.
Schools and businesses around the world were forced to implement remote gatherings, resulting in a growth surge from 10 million to more than 200 million users in less than three months.
That's not to say there haven't been challenges as the number of users ballooned. Hackers gained unauthorized access to meetings -- a practice that's been labeled "Zoombombing" -- disrupting the proceedings with obscenities, racism, and pornography. Zoom responded by redirecting all its research and development efforts, placing a temporary moratorium on new features, and focusing on increased platform security. The company has since rolled out significant upgrades to address the platform's shortcomings.
Even in the face of these challenges, Zoom's astronomical growth has continued, with users soaring from 200 million in March to 300 million in April.
As a result of the pandemic, video meetings have likely become the rule rather than the exception, which bodes well for the future of Zoom.
Data by YCharts.
The megatrends identified in this missive -- digital payments, video games, and videoconferencing -- predated the onset of the coronavirus pandemic, and each has gotten a boost from the stay-at-home orders that have blanketed much of the world.
As a result of their industry-leading positions, each of these companies has fared better than the overall market since the decline that kicked off in mid-February, as illustrated by the stock price chart shown above.
The underlying shifts that powered these market-beating results for PayPal, Activision Blizzard, and Zoom will only continue, making these stocks buys right now.
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If You've Got $3,000 to Invest, Buy These 3 Top Stocks Right Now - Motley Fool