Dump Dogecoin and purchase these 3 prime progress shares as an alternative – Motley Idiot
Invest in Dogecoin is a risky endeavor. In the past month, the cryptocurrency has lost more than 40% of its value while the S&P 500 was flat. And while a tweet from Tesla CEO Elon Musk (“the Dogefather”) could quickly reverse that path, this unpredictability makes it an untenable investment in the long run, even if you’re willing to take moderate risk.
Instead of playing on Dogecoin, investors are better off choosing stocks with a much more solid growth path. Buying shares of GrowGeneration (NASDAQ: GRWG), Adobe systems (NASDAQ: ADBE), and Starbucks (NASDAQ: SBUX) will likely prove to be much safer options in the long run, and you will still get some strong returns.
The hydroponic and horticultural company GrowGeneration was an exceptional investment over the past year, appreciating more than 560% in value over the past year, far outperforming the S&P 500 at 32%. The exciting thing about the stock is that it probably hasn’t peaked yet. Hydroponics can make growing plants more efficient by using pipes and pumps that take up less space than traditional horticultural methods. And that can be particularly useful in the cannabis industry, where both individuals and licensed producers can benefit from the practice. GrowGeneration could play a critical role in the long-term growth of the emerging industry.
In the results for the first quarter ended March 31 (released May 12), revenue increased 173% year over year to $ 90 million. Sales in comparable stores increased by an incredible 51%. The prospects for the company are so good that GrowGeneration is updating its forecast for the year to forecast total annual sales between $ 450 million and $ 470 million. When the company released its fourth quarter figures in March, it forecast sales of no more than $ 430 million in 2021.
As more states pass marijuana laws (including potentially hot markets like New York and New Jersey), demand for GrowGeneration’s products could soon increase. Despite the impressive gains so far, GrowGeneration looks to higher returns in the years to come.
2. Adobe Systems
Tech company Adobe has always been a solid long-term buy. Over the past year, the stock is up 31% and is in line with the S&P 500. What makes the stock a great growth investment is the consistency it offers. For each of the past five fiscal years, the company has generated a profit margin of 20% or better. This is important to investors because it means that for every dollar of revenue the company generates, $ 0.20 goes straight into bottom line.
And Adobe did a good job of increasing sales. For the three-month period ended March 5, the company’s revenue was $ 3.9 billion, 26% higher than last year. With subscription income making up more than 90% of sales, this gives the company a lot of stability. Users also benefit because they don’t have to spend hundreds of dollars on expensive company standalone software and can simply subscribe to it as needed.
Strong branding is key to keeping customers coming back and buying products and services. And the Adobe brand is synonymous with quality. This, along with strong margins, makes the stock ideal to buy and hold for many years to come.
Starbucks is another strong branded company with consumers flocking to its stores all the time, even though cheaper coffee can be found elsewhere. Although the pandemic had a detrimental impact on the business due to lockdowns and restrictions (sales declined more than 11% in fiscal 2020), the company has re-emerged and expanded again.
On April 27th, the company released its second quarter results for the period ended March 28th. Revenue in comparable stores in China was up 91% year over year, while in the US it was up 9%. The company also sees consumers globally spending more; the average ticket size worldwide has increased by 19%. And, as with Adobe, repeat business is a big part of the company’s success. As of the end of the second quarter, Starbucks’ loyalty program had nearly 23 million active Reward Members in the US, 18% more than a year ago. These are all positive signs that the company’s recovery is well underway. Before the pandemic, business grew slowly but steadily: In fiscal 2019, sales rose 7.2% to $ 27 billion, up from 10.4% the year before.
Now that the economy is opening up again in many places and more people can get back to their normal daily routines, the company should be able to build on recent results, which could make the stock an even better buy-in anytime soon. Over the past 12 months, Starbucks shares are up 35%.
This article represents the opinion of the author who may disagree with the “official” referral position of a premium advisory service from the Motley Fool. We are colorful! Questioning an investment thesis – even one of our own – helps us all think critically about investing and make decisions that will help us get smarter, happier, and richer.