You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More
Here's where the big money is going, and how you can profit from their largesse.
A good portion of what we come to rely on in the future could be created here at Tesla's Gigafactory. Credit: Tesla Motors.
One of the things I love most about science fiction is that it so frequently forecasts the future. Jules Verne imagined the submarine in 1870 with Twenty Thousand Leagues Under the Sea. H.G. Wells described the tank in a 1903 story for The Strand magazine. And in 1931's Brave New World, Aldous Huxley foreshadowed antidepressants.
I've not written a lick of science fiction in two decades, so I'm hardly qualified to tell you what's coming next. Fortunately, I don't have to. Venture capitalists and entrepreneurs have spent billions inventing the future, and their bets are well documented.
According to the first-quarter MoneyTree report from PriceWaterhouseCoopers, early-stage investors spent most of their capital on software ($5.58 billion), biotech ($1.73 billion), and industrial and energy businesses ($1.36 billion).
Meet the infrastructure for the connected future The disparity between software and everything else is telling. At the very least, it suggests that VCs believe that we're headed for a connected, app-driven future.
How can we cash in alongside them? By betting on the stocks responsible for the infrastructure of tomorrow. Here are my three favorites.
Tesla Motors(TSLA 1.20%).Wait... isn't Tesla a car company? Not the way I see it. Rather, CEO and co-founder Elon Musk is building a 21st century integrated transportation business that's reinventing how we get and keep power as a byproduct of what it does. In particular, the Powerwall home battery looks to capture and keep solar energy in order to move homes off the grid faster. Miniaturizing that same technology could profoundly impact future laptop, tablet, and smartphone designs, among other things, because long-lived batteries are key to providing continuous connectivity.
Facebook(META 3.25%).The world's largest social network is also the world's largest connected community. What's more, Facebook CEO Mark Zuckerberg is helping to fund global wireless access via Internet.org. In both cases, Facebook is slowly transitioning from "interesting tool" to "daily habit," epsecially when you factor in the 1.25 billion userswho access the platform via a mobile device each month. Most signs point to Facebook serving as the connective tissue of the networked future.
American Tower(AMT -0.62%).Not that long ago, the United Nations estimated that more than4 billion people remained disconnected from the Internet. Serving them with new ditches filled with fiber optic cabling isn't likely when you consider the expense of doing so. Wireless is a better alternative, and no company is better positioned to deliver signal to emerging areas than American Tower. From 47,000 communications sites three years ago to 87,000 as of this writing, the company is in the process of blanketing the globe with pervasive connectivity.
Science fiction or science fact? To me, all three of these stocks look well positioned for the future -- especially given the money that venture capitalists are spending to fund businesses that depend on connectivity. Yet no educated guess is ever perfect, and I've been wrong plenty of times in my investing choices.
What companies do you see inventing the future? Start the discussion by leaving a comment below.
Tim Beyers usually has an apple a day. He's also a member of theMotley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission and owned shares of Apple at the time of publication. Check out Tim'sweb homeandportfolio holdingsor connect with him onGoogle+,Tumblr, or Twitter, where he goes by@milehighfool.
The Motley Fool recommends American Tower, Apple, Facebook, and Tesla Motors. The Motley Fool owns shares of American Tower, Apple, Facebook, and Tesla Motors and has the following options: long January 2017 $80 calls on American Tower. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Related Articles
Why The Trade Desk Stock Jumped 25% in FeburaryWhy Broadcom, Micron, and Intel Stock Are Jumping TodayWhy Snap Stock Fell 31% Last MonthWhy SoundHound AI Stock Is Soaring TodayWhy Ciena Stock Flopped Today
The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, Microsoft, and Nvidia. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft.
Parkev Tatevosian, CFA has positions in Alphabet and PayPal. The Motley Fool has positions in and recommends Alphabet, Amazon, Chewy, Fiverr International, Nvidia, PayPal, Salesforce, and Uber Technologies.
AT&T. AT&T (T 1.67%) spun off the last of its unpredictable media assets in 2023 and lowered its dividend payout accordingly. ...
Ares Capital. With a portfolio valued at about $23 billion, Ares Capital (ARCC 0.09%) is the largest publicly traded business development company (BDC). ...
According to Motley Fool, their Stock Advisor recommendations have averaged returns of 584% since 2002, compared to the S&P 500's return of 114% in the same period. That's over 5x the market's performance.
So Motley Fool is better suited to long-term investors focused on high growth potential while Morningstar is preferable for quantitative investors who rely on metrics and models.
Here at The Motley Fool we stand behind a long-term buy-and-hold strategy across the board for any recommended stock. Additionally, we won't always recommend a sell just because the stock price drops - we prefer to weather market fluctuations and hold stocks in companies that we are confident in for the long term.
It's almost impressive; if you'd followed every recommendation your portfolio would be almost exactly the same value today as it was when you started investing in the service's picks. The Everlasting Stocks picks performed well toward the beginning of the portfolio, and all their original picks were up.
SingularityNET and Fetch.ai are cryptocurrencies that could capitalize on the AI boom. Other cryptos that could be successful include THORChain and Sei. While Bitcoin and Ethereum are already established, they still have solid growth potential.
Introduction: My name is Chrissy Homenick, I am a tender, funny, determined, tender, glorious, fancy, enthusiastic person who loves writing and wants to share my knowledge and understanding with you.
We notice you're using an ad blocker
Without advertising income, we can't keep making this site awesome for you.